Zeev: I have been surprised that all the technicians and chart followers have yet to catch on to what is occurring in Taiwan and its implications for our market. This index peaked after the Fed. "surprise" cut and has been in a relentless bear market downleg since then. Support after support has been breached without much of a fight. I think this index stands in sharp contrast to what has been happening in the SOX and should serve as fair warning.
Taiwan's Key Stock Index Drops to Lowest Close Since Jan 3
Taipei, May 10 (Bloomberg) -- Taiwan's key stock index dropped to its lowest close in four months, led by Taiwan Semiconductor Manufacturing Co. after the biggest chipmaker to customers' design said April sales fell by more than a fifth because of sliding demand.
The TWSE Index slid 110.47, or 2.1 percent, to 5122.17, it lowest close since Jan. 3. Five stocks fell for every one that rose. TSMC accounted for almost a fifth of the index's decline. Trade slumped to NT$40.4 billion ($1.2 billion), the lowest level this year.
Gartner Inc., a consultancy, said global semiconductor sales will fall 17 percent this year to $188 billion from the previous year.
``There is an oversupply and an overhang of inventory'' of electronic components including semiconductors, said Keon Han, the regional technology analyst at Bear Stearns Asia Ltd. in Hong Kong. ``A factor has been the PC price war and the resulting pressure it's putting on component prices.''
The following stocks made significant gains or losses:
Taiwan Semiconductor Manufacturing Co. (2330 TT <Equity>) fell NT$2.50, or 2.6 percent, to NT$92.50. TSMC said April sales dropped 21 percent to NT$9.2 billion from March. Its U.S. shares fell 58 cents, or 2.6 percent, to $22.20 yesterday.
United Microelectronics Corp. (2303 TT <Equity>) fell NT$1, or 1.9 percent, to NT$51.50. The world's second-biggest chipmaker on a made-to-order basis said April sales fell 12 percent to NT$5.8 billion. The stock's U.S. shares fell 18 cents, or 1.7 percent, to $10.32 yesterday.
Advanced Semiconductor Engineering Inc. (2311 TT <Equity>) fell 70 cents, or 2.6 percent, to NT$26. The second-largest provider of chip-assembly services said sales in April dropped 22 percent to NT$3 billion from the previous month.
ASE Test Ltd. (9101 TT <Equity>) fell 10 cents, or 1.5 percent, to NT$6.40. The biggest semiconductor testing company in Asia said April revenue fell 26 percent from March to $23.9 million. Its U.S. shares fell 70 cents, or 4.8 percent, to $14 yesterday.
Asustek Computer Inc. (2357 TT <Equity>) fell NT$3, or 2 percent, to NT$148. Taiwan's largest maker of computer circuit boards said April sales fell 28 percent from March to NT$5.8 billion. Motherboard shipments fell 38 percent to one million units and sales of notebooks grew almost two-thirds to 65,000 units.
Chunghwa Telecom Ltd. (2412 TT <Equity>) fell NT$1, or 1.5 percent, to NT$65. Taiwan's biggest phone company said it will borrow NT$30 billion ($912 million) from a group of banks led by First Commercial Bank. The loan is the company's first. Chunghwa will pay interest at the rate of 4.1125 percent on the three-year loan, said Fu Fu-shen, senior administrator in Chunghwa's investor relations department. That compares with a benchmark overnight lending rate in Taiwan of 4.134 percent.
Far Eastern Textile Ltd. (1402 TT <Equity>) rose 70 cents, or 3.9 percent, to N$18.60. The Taiwan conglomerate controlled by the Hsu family said it will buy back 50 million or 1.62 percent of its 3 billion shares to boost its stock price.
Microtek International Inc. (2305 TT <Equity>) fell 80 cents, or 6.2 percent, to NT$12.10. The computer-scanner maker plans to sell shares in Shanghai to try end three years of losses.
Siliconware Precision Industries Co. (2325 TT <Equity>) fell NT$1.60, or 6.8 percent, to NT$22.10. Taiwan's second-largest chip assembler said April sales fell 23 percent from March to NT$1.27 billion.
Taishin International Bank (2844 TT <Equity>) fell 80 cents, or 4.7 percent, to NT$16.10. Taiwan's second-largest credit card issuer said it will invest NT$1.1 billion to upgrade its computer system after a surge in transactions overwhelmed its network.
Taiwan Cellular Corp. (4901 TT <Equity>) rose 10 cents, or 0.3 percent, to NT$37.70. The island's biggest mobile phone company by customers said sales reached NT$4 billion in April, a 9.6 percent increase from last year. Pretax profit rose 14 percent to NT$1.3 billion.
Winbond Electronics Corp. (2344 TT <Equity>) fell NT$2.50, or 6.6 percent, to NT$35.20. Taiwan's third-largest chipmaker by market value said sales in April rose 1.5 percent from March to NT$2.41.
Yageo Corp. (2327 TT <Equity>) fell NT$2.80, or 7 percent, to NT$37.30. The largest maker of parts that control the flow of electricity in circuits said it will fire about 10 percent of its 7,220 workforce to slash costs. Yageo will start firing workers at factories in Taiwan, China, and Holland to cut costs by 30 percent by the end of June, said Vincent Weng, deputy manager of Yageo's business development department.
Memory chipmakers fell after the current industry standard chip, 128-megabit 8x16 PC100 dynamic random access memory, fell to $3.90, according to ConvergeTrade, which provides a market for buying and selling semiconductors. That is below the cost of production for most chipmakers.
Mosel Vitelic Inc. (2342 TT <Equity>) fell NT$1.10, or 5.1 percent, to NT$20.30. Nanya Technology Corp. (2408 TT <Equity>) fell NT$1.20 or 4.1 percent, to NT$28.40. Powerchip Semiconductor Corp. (5346 TT <Equity>) fell 90 cents, or 3.1 percent, to NT$28.30. Pro Mos Technologies Inc. (5387 TT <Equity>) fell NT$1.10, or 3.3 percent, to NT$32.20.
May/10/2001 2:17 ET |
