Taiwan shares closed 0.29 percent lower on Wednesday, easing off a 7-year high, as index heavyweights such as top contract chip maker TSMC tracked losses on US tech shares overnight. The main TAIEX share index slipped 23.87 points to 8,346.39, as the electronics sub-index declined 0.67 percent and the financial sub-index gained 0.28 percent.
Turnover was active at T$130.57 billion ($4 billion), but lower than T$143.8 billion in the previous day. The main index hit a seven-year closing high of 8,370.26 points in the previous session, after touching an intraday peak of 8,396.22. "The US's drag really led domestic tech shares into a slight correction," said Sinopac Securities manager Alvin Teng.
"There's still a lot of uncertainty in global markets and risk is higher now," said Alex Huang, vice president at Mega Securities, adding that the market would see pressure at 8,400 points.
US stocks tumbled on Tuesday as bond yields shot to their highest level in five years, raising fears that higher borrowing costs could cut into corporate profits and discourage take-overs. Heavyweight Taiwan Semiconductor Manufacturing Co (TSMC) fell 1.08 percent, after its shares in the United States dropped 1.82 percent overnight.
Smaller rival United Microelectronics Corp (UMC) declined 0.76 percent. But AU Optronics gained 0.18 percent after it said at its annual shareholders meeting that it would return to profit in the current quarter and that it is operating at full capacity.
Taiwan Cement rose 2.95 percent and Chia Hsin Cement jumped 6.13 percent after the Commercial Times reported that the two firms were forming a China-focused strategic alliance through their respective Hong Kong-listed units, TCC International and Chiahsin Cement.
Hon Hai Precision Industry Co declined 0.19 percent after its Hong Kong-listed unit Foxconn International Holdings said on Tuesday that it would invest US $1 billion in the next year to double its capacity and meet demand for cellphones from Sony Ericsson and other mobile phone vendors.
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