Fri, Apr 15, 2005 page11

• Business Briefs

  • AGENCIES
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  ■ Stock prices decline

  Shares ended lower yesterday, tracking declines in major Asian markets, but memory-chip stocks outperformed on hopes prices of the chips will bottom out soon, analysts said. The TAIEX fell 21.40 points, or 0.4 percent, to 5,976.68. In dealings totaling NT$60.41 billion (US$1.91 billion). "Markets across Asia are not doing well today, so there's no surprise why we are down," said Derek Lam, head of trading at Fubon Securities Co (富邦證券). Caution ahead of many technology firms' earnings reports later this month is expected to continue to depress market activity in coming sessions, traders said. Among the tech companies expected to issue their first-quarter 2005 and full-year 2004 results in the last week of April are flat panel makers AU Optronics Corp (友達光電) and Chi Mei Optoelectronics Corp (奇美電子), and chipmaker Taiwan Semiconductor Manufacturing Co (台積電).

  ■ CAL secures bank loans

  China Airlines (華航), the nation's largest air carrier, said it raised NT$10 billion (US$316 million) through loans from 12 Taiwanese banks to help pay for new aircraft and to take advantage of low interest rates. The airline will pay annual interest of about 2.08 percent for two 12-year syndicated loans, each of NT$5 billion, the Taipei-based company said in an e-mailed statement today. The loans "will help lower operating costs," the carrier said. The interest rate is 16.7 basis points lower than the 2.247 percent yield the benchmark 10-year government bonds closed at today. The carrier will receive 10 new planes this year -- five Airbus SAS A330-300s, two Boeing Co 747-400s and three Boeing 747-400Fs -- helping to boost its fleet to 66 aircraft by the end of this year, the company said.

  ■ Hon Hai's ranking rises

  Hon Hai Precision Industry Co (鴻海精密) was raised to "overweight" from "equal-weight" by analyst Ellen Tseng at Morgan Stanley & Co, because of the company's fast market share gain, several mergers and acquisitions in the past two years, and planned expansion into the automobile market. Tseng in a report dated yesterday said shares of Taiwan's largest electronics company by sales will rise to NT$168.40 in the next 12 months, up from her previous estimate of NT$152. Hon Hai was unchanged at NT$142.50, after climbing as much as 1.1 percent, on the stock exchange.

  ■ NT dollar falls on selloff

  The New Taiwan dollar had its weakest close this month after international money managers sold the most stocks in two weeks. Investors based outside Taiwan sold a net US$105.9 million of Taiwanese shares yesterday, the biggest amount since March 30, and almost twice as much as in the previous two days, according to Taiwan Stock Exchange data. Global investors jettisoned a net US$518.7 million of equities in March, contributing to the currency's 1.1 percent drop, its first monthly slide since July. "Fund inflows to Asia mainly go to the stock market and concern about earnings raises speculation investors will slow purchases of the region's assets, including Taiwan," said Osamu Takashima, chief analyst of foreign exchange and treasury division in Tokyo at Bank of Tokyo-Mitsubishi Ltd. "This is negative for Taiwan's currency." The NT dollar dropped 0.2 percent to NT$31.617 against its US counterpart from yesterday's close, according to Taipei Forex Inc. The currency, which has risen 1 percent in the past three months, may fall to NT$31.75 this week, Takashima said.
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