Taiwan stocks close with slight losses

Taiwan stocks closed lower on Monday as investors took profits from last week's rally that came after political uncertainties eased as President Chen Shui-bian began his second term in office without incident.
The main TAIEX ended down 0.38 percent at 5,942.08, following last week's 3.2 percent rally but recouping a big chunk of early losses as bargain hunters used market dips to buy tech shares like Chi Mei Optoelectronics.
"The pullback was within our expectations after recent gains. With political worries easing, some downstream tech companies that have solid fundamentals still attracted buying," said Kevin Lin, an asset manager at Shinkong Investment Trust.
Shares in display screen maker Chi Mei jumped 0.72 percent to T$70.00 as investors bet on better earnings growth this year. However, Taiwan Semiconductor Manufacturing Co, the world's top contract chipmaker, fell 1.82 percent to T$54.00.
Chunghwa Telecom Co, the island's largest phone company, finished down 1.82 percent at T$54.00 after a government official denied a report that the government planned to sell a 16 percent stake of the company at a 20 percent discount.
The day's losses ignored gains on US stocks on Friday.
The US Dow Jones finished up 0.29 percent and the tech-heavy Nasdaq jumped 0.82 percent on Friday after Saudi Arabia's call for higher production drove oil prices lower.
But investors chased industrial shares, putting aside lindering worries over China's moves to cool its booming economy.
Tung Ho Steel rose 3.23 percent to T$22.40 and rival Yieh Phui added 1.83 percent to T$22.20.
China on Monday denounced Chen Shui-bian's inaugural speech as a cloaked address on independence and said Beijing would spare no cost if he continued down the road to statehood.
But analysts said China just reiterated its long-standing position and the market did not react too much to the comments.
Chen won re-election by a razor-thin margin, triggering weeks of protests and demands for a recount, which was completed only days before his May 20 inauguration.
The over-the-counter market's TAISDAQ index inched down 0.05 percent to end at 130.52, and the TAIEX May index futures contract rose 0.53 percent to 5,871.