Taiwan Stock Futures, Dollar Fall; President Injured by Gunshot
19/3/2004 12:44
Taiwan's stock-index futures fell, suggesting U.S. shares of companies such as Taiwan Semiconductor Manufacturing Co. may decline after President Chen Shui-bian was injured by gunfire on the eve of the presidential election.
The MSCI Taiwan Index futures due in March shed 1.6 percent to 284.10, after falling as much as 2.5 percent, at 6:32 p.m. in Taipei. The Taiwan dollar closed at NT$33.253 against its U.S. counterpart from yesterday's NT$33.22, according to Taipei Forex Inc. Ten-year bond yields were unchanged at 2.33 percent.
``This is negative'' for markets, said Winson Fong, who manages $2 billion at SG Asset Management in Singapore. ``Nobody knows what happened, the reasons or who did that.''
The abdomen injury sustained by Chen, 53, isn't life threatening and tomorrow's election will go ahead as scheduled, said Chiou I Jen, secretary-general of the Presidential Office. He said the injury occurred at 1:45 p.m., local time. No arrests have been made and no motive for the attack known, Chiou said.
Taiwan's stock benchmark is the world's sixth-best performer this year in dollar terms, up 18 percent. Shares of Uni-President Enterprises Corp., the second-largest instant noodle maker in China, and China Airlines, Taiwan's largest airline, have led gains on optimism a victory for the opposition Nationalist Party, or Kuomintang, would improve relations with China and open direct transportation links. Chen is the incumbent for the Democratic Progressive Party.
``We have no plans to change our investment strategy for Taiwan unless there is rioting or if the DPP comes out as the winner,'' said Peter Chau, a fund manager who helps manage about $700 million in Asia, including shares of Taiwan Semiconductor and United Microelectronics Corp., at TAL CEF Global Asset Management Ltd. in Hong Kong. ``We are expecting the KMT to win and have built up our portfolio around that.''
U.S. Shares
The TWSE Index closed 0.4 percent higher at 6815.09 at 1:30 p.m. local time, just before the shooting.
Shares of Taiwan Semiconductor, the world's largest supplier of made-to-order chips, AU Optronics Corp., Taiwan's biggest maker of liquid crystal displays, and Chunghwa Telecom Co., the island's No. 1 phone service provider trade in the U.S. as American depositary receipts.
Chen is under treatment in Chi Mei Medical Center in the southern city, his spokesman said at a press briefing about two hours after the injury. A security force has been dispatched to protect Lien, the Nationalist Party candidate, he said.
The Taiwan dollar has risen 2.1 percent this year against its U.S. counterpart as overseas investors raised demand for the island's stocks on expectations economic growth is quickening. The currency is the second-best performer in 2004 among 15 Asian Pacific currencies tracked by Bloomberg News.
``As long as the election continues, there probably won't be any major impact on the financial markets,'' said Pang Shun-Pen, who helps manage $400 million in Asia, excluding Japan, at HSZ Singapore Pte. in Singapore. He said he won't sell his shares of Taiwan companies because of the news.
The MSCI Taiwan Index futures due in March shed 1.6 percent to 284.10, after falling as much as 2.5 percent, at 6:32 p.m. in Taipei. The Taiwan dollar closed at NT$33.253 against its U.S. counterpart from yesterday's NT$33.22, according to Taipei Forex Inc. Ten-year bond yields were unchanged at 2.33 percent.
``This is negative'' for markets, said Winson Fong, who manages $2 billion at SG Asset Management in Singapore. ``Nobody knows what happened, the reasons or who did that.''
The abdomen injury sustained by Chen, 53, isn't life threatening and tomorrow's election will go ahead as scheduled, said Chiou I Jen, secretary-general of the Presidential Office. He said the injury occurred at 1:45 p.m., local time. No arrests have been made and no motive for the attack known, Chiou said.
Taiwan's stock benchmark is the world's sixth-best performer this year in dollar terms, up 18 percent. Shares of Uni-President Enterprises Corp., the second-largest instant noodle maker in China, and China Airlines, Taiwan's largest airline, have led gains on optimism a victory for the opposition Nationalist Party, or Kuomintang, would improve relations with China and open direct transportation links. Chen is the incumbent for the Democratic Progressive Party.
``We have no plans to change our investment strategy for Taiwan unless there is rioting or if the DPP comes out as the winner,'' said Peter Chau, a fund manager who helps manage about $700 million in Asia, including shares of Taiwan Semiconductor and United Microelectronics Corp., at TAL CEF Global Asset Management Ltd. in Hong Kong. ``We are expecting the KMT to win and have built up our portfolio around that.''
U.S. Shares
The TWSE Index closed 0.4 percent higher at 6815.09 at 1:30 p.m. local time, just before the shooting.
Shares of Taiwan Semiconductor, the world's largest supplier of made-to-order chips, AU Optronics Corp., Taiwan's biggest maker of liquid crystal displays, and Chunghwa Telecom Co., the island's No. 1 phone service provider trade in the U.S. as American depositary receipts.
Chen is under treatment in Chi Mei Medical Center in the southern city, his spokesman said at a press briefing about two hours after the injury. A security force has been dispatched to protect Lien, the Nationalist Party candidate, he said.
The Taiwan dollar has risen 2.1 percent this year against its U.S. counterpart as overseas investors raised demand for the island's stocks on expectations economic growth is quickening. The currency is the second-best performer in 2004 among 15 Asian Pacific currencies tracked by Bloomberg News.
``As long as the election continues, there probably won't be any major impact on the financial markets,'' said Pang Shun-Pen, who helps manage $400 million in Asia, excluding Japan, at HSZ Singapore Pte. in Singapore. He said he won't sell his shares of Taiwan companies because of the news.
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