Taiwan's TAIEX dropped, led by United Microelectronics Corp (UMC, 聯電), after the government said it will scrap its ban on the island's chip industry investing in mainland China by the end of the year. This will be later than expected.
The TAIEX slid 8.08, or 0.1 percent, to 5849.85, after rising as much as 0.9 percent and falling as much as 0.4 percent.
Seven stocks rose for every two that fell. The total value of trade yesterday was NT$87.8 billion (US$2.5 billion) a 34 percent drop from Friday's NT$132.7 billion.
Leaving the broad index mixed, Formosa Plastics Corp (台塑) rose after it said Friday it will team with Japan's Fujitsu Hitachi Plasma Display Ltd and Au Optronics Corp (友達光電) to make television flat panels in a venture worth up to NT$15 billion (US$429 million).
``It's positive news for all three companies because it allows the Japanese companies to cut costs and allows AU Optronics and Formosa Plastics to have leading technology from Japan,'' said Cecilia Liu, an analyst at CLSA Ltd.
``There is profit-taking pressure,'' said Steven Hsieh, who manages about NT$2.5 billion (US$71 million) in Taiwan stocks at Dresdner Asset Management Taiwan Ltd. Also ``There is a seven-trading day holiday during Chinese New Year so people will want to reduce the uncertainty of what will happen over the period by taking profits.''
UMC fell NT$1.10, or 2.4 percent, to NT$45.80. UMC's US shares fell 5.7 percent to US$8.32 on Friday. Formosa Group companies rose after Formosa Plastics, the flagship of Taiwan's largest industrial group, said it will take a 55 percent stake in a three-way venture to make so-called plasma screens, which will have initial capital of NT$2.8 billion.
Formosa Plastics added NT$1.70, or 3.9 percent, to NT$45. Formosa Chemical & Fibre Corp (台塑化纖) gained NT$2.20, or 6.5 percent, to NT$35.90. Nan Ya Plastic Corp (南亞塑膠) rose 90 cents, or 2.8 percent, to NT$33.30.
Au Optronics, the biggest flat panel maker in Taiwan, rose NT$1.20, or 2.4 percent, to NT$50.50.
Delta Electronics Inc (台達電子) fell NT$2, or 3.3 percent, to NT$59.50. Shares of the company's Thai unit, Delta Electronics (Thailand) Pcl, were suspended by the Thai stock exchange pending a company response to a report that said the government ordered the closure of its six factories on the outskirts of Bangkok.
United World Chinese Commercial Bank (世華銀行) fell 20 cents, or 1 percent, to NT$20. The island's sixth-biggest lender by assets delayed its assessment of setting up a holding company to acquire other lenders, the Economic Daily reported, without citing sources.
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