Taipei shares outlook: Higher on Wall St; gains to be capped by UMC div

TAIPEI (AFX-ASIA) - Share prices are expected to open higher following Wall Street's overnight gains, made as positive consumer confidence data suggested the economic outlook may not be as bad as feared, dealers said.	    The U.S. consumer confidence figures may be doubly welcome as the latest local economic data released yesterday was quite weak, they said, adding that the Bankers Association's decision to allow 6-month extensions on corporate loan repayments should also help.	    At the same time, any gains may be constrained by disappointment over United Microelectronics Corp board of directors' proposal for a 1.50 twd stock dividend for 2000, they added.	    Yesterday, the weighted index closed down 11.99 points at 5,884.33 on turnover of 151.28 bln twd. 	    Foreign institutions were net buyers of shares worth 1.35 bln twd, local investment trusts net buyers of 1.73 bln twd and brokers net sellers of 322.78 mln twd.	    Entrust Securities Investment Consulting Co assistant vice president Tom Tang said Wall Street's overnight strength will help bolster the local stockmarket after the weak February leading indicator figures yesterday.	    At the same time, Tang said the Taiwan figures may not have been that surprising while the Nokia and Ericsson job cut announcements yesterday may encourage local hopes that the island will benefit from increased outsourcing contracts as major electronics companies seek to cut costs.	    "There are hopes that these two telecommunication leaders may increase their outsourcing and Taiwan contract manufacturers may benefit from more orders accordingly."	    However, UMC's proposed 2000 stock dividend came in well below expectations and this might dampen the overall performance today, Tang said.	    "The stock dividend of 1.50 twd stands far below market expectations of 4.00-5.00 twd, triggering a possible sell-off on disappointment."	    Some investors built positions yesterday on hopes of a high UMC dividend payment and those speculators may now sell off.	    "The low stock dividend plan may be negative for the share's short-term prospects but it could be positive for the long-term outlook," Tang said, noting that UMC's EPS for this year could outstrip that of TSMC, which plans to pay a 4.00 twd stock dividend.    

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