GM, all... more bear food, with possible bull and bear food in last article. Gotta love that guy's "buy report" (from the 3rd article)....'You've got a company with no net debt that's a manufacturer," he said.'
Taiwan Stocks Fall on Profit Concern; TSMC Leads
Taipei, June 29 (Bloomberg) - Taiwan's benchmark stock index took its
biggest dive in more than two weeks, as investors fretted profits at
technology companies may keep falling.
Computer-related companies as a group lost more than 4.7 percent, their largest decline so far this month.
Taiwan Semiconductor Manufacturing Co., the bellwether technology stock, said Friday it cut this year's capital expenditure for expansion by 29 percent to $920 million, more evidence weak demand for semiconductors and other components is taking a toll on Taiwan's economy.
The benchmark TWSE index tumbled 146.23 or 1.90 percent to 7,535.73, its steepest decline since June 10. The electronics subindex accounted for two thirds of the index's fall.
Trading fell to NT$99.8 billion ($2.9 billion), 12 percent lower than
the three-month daily average. More than three stocks fell for each that gained.
We expect Taiwan's technology companies to take a much longer time to
recover from the [computer] glut'' said Michael Ding, a vice president
of Citicorp International Securities Ltd.
Taiwan Semiconductor, the world's largest maker of computer chips to
client design, lost NT$2.50 to NT$72. Some analysts have estimated its
sales will drop for the fifth month in June after it reported its lowest sales this year in May.
Asustek Computer Inc., which makes computer motherboards tailored to
Intel Corp. chipsets, fell NT$13 to NT$267. Some analysts said its
profit margins have dropped to 24 percent from more than 30 percent last year.
Compeq Manufacturing Co, the largest printed circuit board maker in
Taiwan, tumbled by the daily 7 percent limit to NT$177. Advanced
Semiconductor Engineering Inc., the second-biggest chip packager in the world, fell 7 percent to NT$59.
United Microelectronics Corp., Taiwan Semiconductor's closest rival,
fell NT$0.90 to NT$39.30.
Holtek Sees Loss
Its Holtek Microelectronics Corp. unit fell NT$1.40 to NT$28.30. Holtek, a semiconductor maker, altered its forecast for the year to a loss of NT$493 million from the net profit of NT$1.72 billion it predicted earlier.
Everyone in the industry is suffering,'' said D.P. Yang, a spokesman for Holtek.
Mitac International Corp., which makes computers for Compaq Computer
Corp., fell NT$1.50 to NT$67. The Economic Daily News said its sales in June may hit a record high of NT$3.7 billion, beating market
expectations. All listed companies in Taiwan must report Sales for June before July 10.
Investors have little confidence in electronics companies as a whole,"said Kevin Chang, a fund manager with Kwang Hwa Securities Investment and Trust Co., which oversees NT$55 billion ($1.6 billion) in client assets.
Last week, fund managers reduced their holdings of electronics shares by about 5 percent, and many small investors are expected to follow suit, he said.
Acer Inc., the eighth-largest computer maker in the world, lost NT$2.30 to NT$41.20. Acer Group said last week it signed an agreement with Internal Business Machines Corp. to license some of IBM's most advanced chip-making technology.
Compal Electronics Inc., which makes notebook computers for Dell
Computer Corp., fell NT$6 to NT$90.50.
Taiwan Tea Corp., which owns more land than any other listed companies
in Taiwan, lost 7 percent to NT$67.50, after rising more than 70 percent so far this month amid speculation it will book huge profits from sales of farmland.
02:38:35 06/29/1998
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TSMC Cuts 1998 Capital Expenditure by 29 Percent
Taipei, June 26 (Bloomberg) - Taiwan Semiconductor Manufacturing Co. has cut its planned capital expenditure for this year by 29 percent after sales fell to their lowest level this year in May.
TSMC, the world's biggest customized chipmaker, slashed its planned
investment to expand capacity to $920 million from $1.3 billion, a
company statement said. After the revision, its capacity will still
increase 38 percent from 1997.
The cuts follow a 57-percent fall in prices for 16-megabit dynamic
random access memory (DRAMs) chips -- widely used in personal computers and consumer electronics products - in the past six months.
TSMC and United Microelectronics Group, -- which dominate the world's
foundry industry -- and six other Taiwanese companies have trimmed about NT$68 billion ($1.97 billion), or 41 percent from their planned
investments, the Commercial Times reported yesterday.
In Taipei, TSMC fell NT$2.50 to NT$74.50, a two-week low, before the
announcement. United Microelectronics Corp. fell NT$1.10 to NT$40.10,
its lowest since June 15.
01:24:44 06/26/1998
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Fidelity's Richard Fentin: U.S. Stock Market Comment
New York, June 25 (Bloomberg) -- A comment on recent activity in the
U.S. stock market:
You've had this wonderful environment,'' including low interest rates,
said Richard B. Fentin, manager of the $8 billion Fidelity Value Fund.
''My guess is that when that changes, that's when you're going to see a change in the stock market.''
Until then, there are plenty of stocks that are undervalued, he said.
''The market of stocks clearly hasn't performed as well as the averages have,'' Fentin said.
The stocks that "have had bear markets and are values" include energy
and gaming issues, he said.
National Semiconductor Corp. also looks cheap, he said. "You've got a
company with no net debt that's a manufacturer," he said.
As earnings increase, so does stock appreciation," Fentin said.
14:01:50 06/25/1998
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