Taiwan shares ended lower on Friday, pressured by concerns that the weekend protest over the disputed presidential election could further complicate the controversy, dealers said.
The Weighted Price Index of the Taiwan Stock Exchange finished 24.11 points lower, or 0.4 percent, at 6132.62 in dealings valued at 97.79 billion New Taiwan dollars (US$2.9 billion). Declining issues outnumbered advancers nearly four to one, while 132 ended the day unchanged.
"Taiwan opened high today based on the Nasdaq's rise, but selling pressure was pretty heavy because of tomorrow's protest,'' said Andrew Teng, deputy sales manager at Taiwan International Securities in Taipei.
The Nasdaq Composite Index rose 3 percent in US trading overnight. The tech-heavy Taiwan bourse tends to move in line with the Nasdaq due to close cooperation between firms in Silicon Valley and Taiwan.
However, a rally by the Nationalist Party planned for Saturday raised concerns the political impasse may take a long time to resolve.
Some fear the continuing protests could turn violent, though most dealers believe they won't because it would damage the Nationalists' cause. People in Taiwan tend to look down on violence and public opinion carries great weight in the democratically ruled nation.
A dealer at Taiwan Securities said the two opposition running mates defeated in last weekend's vote could drag out Taiwan's political uncertainty, since confirmation of the result might mean their political careers are over.
"They're like drowning men," he said.
Transportation shares led the decline.
Taiwan's airline shares suffered their fifth straight day of 6 percent or more declines after investors sold them off following the re-election of President Chen Shui-bian. He is regarded as being less likely than the opposition to move quickly on restarting direct transport links with rival China.
China Airlines fell 6.2 percent to NT$18.3, while Eva Airways dropped 6.4 percent to NT$16.
Taiwan's largest cargo shipper, Evergreen Marine, retreated 6.2 percent to end at NT$30.5.
Other shares tied to China trade fell as well, with Kenda Rubber off 1.3 percent at NT$30.1 and Cheng Shin Rubber Industrial down 2 percent at NT$45.2. Both firms have large operations in China.
Taiwan's technology subindex eked out a 0.2 percent gain despite the overall market decline.
Chip giant Taiwan Semiconductor Manufacturing rose 0.9 percent to NT$58.5, while rival United Microelectronics added 0.4 percent to NT$28.6.
Hon Hai Precision, one of the world's largest contract electronics manufacturers, rose 1.1 percent to NT$140 after the firm said it reached a settlement on a patent infringement lawsuit by FCI, and was granted a worldwide license to use the disputed technology.
Shares in makers of panels used as computer screens in notebooks, desktop monitors and mobile phones rose.
AU Optronics ended up 1.8 percent at NT$57, while rival Chi Mei Optoelectronics finished 3.9 percent higher at NT$53.5.
Sintek Photronic rose 1.2 percent to NT$25.9 and Allied Material Technology gained 2.8 percent to NT$21.8 as prices for the color filters they make rose.
"Expectations that continued tight supply of color filters will boost product prices provided support for these two stocks," said Stanley Chou, a manager at Barits International Securities.
Dealers said the market could rise tomorrow if yesterday's rally was peaceful, and brings the parties closer to a deal, but few expect a quick resolution.
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