Stocks fall as UMC declines after government stake sale

Taiwan stocks fell for a fourth day, with United Microelectronics Corp (UMC, 聯電) as the index's second-biggest decliner, after the government Thursday sold US$440 million of the chipmaker's shares in the US.

"The government's strategy is to sell its stake in the US to avoid putting pressure on the local market," said Jerry Chen (陳乃漢), manager of First Global Investment Trust Co's (元大證券投信) NT$3 billion (US$86 million) Excellent Fund. "Investors, however, will still be stunned by the big sell order overseas."

The TAIEX fell 119.05, or 2 percent, to 5951.45, its biggest percentage decline since Feb. 20. For the week, the index fell 1 percent. Within the index, 395 stocks fell and 116 rose.

The total value of trade was NT$119 billion (US$3.4 billion), more than a tenth above the six-month daily average of NT$105 billion.

UMC fell NT$2.70, or 5.2 percent, to NT$49.30 after the government sold 1.8 percent of the company for US$440 million through the sale of American depositary receipts.

Meanwhile, the second-largest made-to-order chipmaker declared a stock dividend of 150 shares for every 1,000 held, and said it would issue 171 million new shares for employee bonuses.

UMC's US-traded shares dropped 5.1 percent to US$9.25, their biggest drop since Feb. 19.

Taiwan Semiconductor Manu-facturing Co (TSMC, 台積電), UMC's largest rival, fell NT$2.50, or 2.7 percent, to NT$90.50.

Computer-memory-chip makers fell after the price of 128MB dynamic random access memory chips and high-speed memory chips fell for a third day Thursday, according to DRAM Exchan-ge, a marketplace for memory chips.

Winbond Electronics Corp (華邦電子), Taiwan's second-largest computer-memory-chip maker by market value, fell 60 cents, or 2.2 percent, to NT$26.20. Nanya Technology Corp (南亞科技), the largest, slipped NT$1.60, or 3.7 percent, to NT$42.20. Powerchip Semiconductor Corp (力晶半導體), Taiwan's second-largest computer-memory-chip maker by sales, fell NT$1.20, or 4.4 percent, to NT$25.80.

Asustek Computer Inc (華碩電腦), Taiwan's largest motherboard maker, fell NT$3, or 1.8 percent, to NT$160 on concern personal computer makers will delay placing orders until after Intel Corp cuts the prices of chips that run PCs. On Thursday, Credit Suisse First Boston said PC sales will be weaker than expected.

Lite-On Technology Corp (源興科技) rose NT$3, or 4.4 percent, to NT$70.50. The computer-monitor-screen maker tripled its 2002 earnings per share forecast to almost NT$9 to include a gain from selling shares it held in unit LITE-ON Information Technology Corp (建興電子), a Chinese-language newspaper reported, citing the parent company's president Liao Hsueh-fu (廖學福).

Lite-On Information Technology fell NT$1, or 0.5 percent, to NT$214.

Via Technologies Inc (威盛電子) fell NT$5, or 3.5 percent, to NT$140.

The second-largest designer of personal-computer chipsets plans to develop new graphics chips with Europe's STMicroelectronics NV as the two compete for orders for graphics chipsets for Microsoft Corp's Xbox video-game consoles, local media reported.