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Local bourse begins Q4 on low note

Taiwan stocks began the fourth quarter on a low note yesterday as the weighted TAIEX fell below 7,700 on the lowest trade volume in two months.

At the end of the session, the TAIEX closed at 7,675.72, down 39.44 points or 0.51 percent, on trade volume of NT$56.288 billion, the lowest since July 25.

At one point of trade, the TAIEX fell to 7,657, below the low of 7,660 seen Sept. 14. Stocks in China, Hong Kong and South Korea were all closed yesterday.

Foreign investors posted a net purchase of NT$553 million, while investment trusts and securities firms had net sale of NT$489 million and NT$437 million, respectively. The figures translated into a total net sale of NT$337 million.

Stocks gave disparate performances by category. Financial shares were weak after the government over the weekend announced the final version of the second-generation national health insurance program.

Under the program, a portion of savings interest and stock dividends will be taken away from certain individuals to add to the health insurance funds. The new measure has spawned concerns people will take their business away from financial institutions.

Among the gainers were paper, biotech, channeling and construction shares, which rose 1.8 percent, 2.1 percent, 1 percent and 0.7 percent, respectively.

Major electronics shares and large-cap shares were volatile. Non-Apple shares such as HTC and MediaTek resisted the declining trend and rose.

Hey-Song fell NT$4.1 to NT$45.2, despite Ruentex's huge offering to purchase its land parcel that is currently used as a parking lot behind Breeze Center in downtown Taipei.

Biotech shares were strong, with Medigen Biotechnology Corp. surging to NT$110, its highest ever.

With narrowed trade volume, the TAIEX may hover near the 7,600 mark for the short-term, said Huang Kuo-wei, assistant manager with Mega Securities. Yet various positive developments, including a dissipation of the European debt crisis and rising exports in the fourth quarter, will provide support for the TAIEX in the long term, he added.

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