Taiwan stocks close on two-year low

Dec 15, 2011, 9:13 GMT

Taipei - Taiwan's stock market fell Thursday amid increasing concerns over the impact of the European debt crisis on Taiwan's export-driven high-tech companies.

The benchmark TAIEX index fell 157.98 points, or 2.28 per cent, to close at the day's low of 6764.59. It was the lowest close since August 27, 2009.

The index was down 19.7 per cent for 2011.

Investors followed global assessments that the measures agreed at the European summit last week were not enough to reduce borrowing, ensure growth, and provide a rescue scheme large enough to guarantee existing eurozone debts.

Italian bonds were selling at a yield of 6.47 per cent Wednesday, indicating a lack of faith that the European economy would pick up. Europe is a key export market for Taiwanese high-tech goods.

Flat-panel maker AU Optronics Corp dropped 4.17 per cent, while Taiwan's largest electronics manufacturer Hon Hai Precision Industry Co Ltd plunged 3.79 per cent. Shares in Taiwan Semiconductor Manufacturing Co sank 2.68 per cent.

In the currency market, weakness in the euro further fuelled the strength of the US dollar, which rose to 30.37 Taiwan dollars from 30.29 Taiwan dollars at close on Wednesday.