Taipei shares outlook: Mixed to higher after MSCI changes

TAIPEI (AFX-ASIA) - Share prices are expected to open mixed to higher 

with select stocks seen benefitting from the MSCI changes announced over the 

weekend, dealers said.

	    They said some stocks may at the same time come under pressure from the 

changes but amongst these, TSMC, for example, might enjoy continued foreign 

investor support so the impact could be muted overall.

	    With President Chen Shui-bian due to set out on a two-week tour of Latin 

America today, the market may have just limited downside given the 

possibility of government support during this period, they added. 

	    On Friday, the weighted index closed down 31.77 points at 5,111.67 on 

turnover of 46.47 bln twd.

	    Foreign institutions were net buyers of shares worth 2.69 bln twd, local 

investment trusts net buyers of 442.10 mln twd and brokers net buyers of 85.

54 mln twd.

	    Topping the foreign investor net purchases list was TSMC at 12.87 mln 

shares. 

	    "The latest MSCI changes should be considered a mixed bag for the broader 

market and accordingly the impact is unlikely to prove significant," SinoPac 

Securities analyst Teng Ke-hsin said. 

	    Already priced in to a large extent by the market, the MSCI lead will 

probably inspire some volatility, he said. 

	    "Any such impact is likely to prove short-lived as concerns over the 

prospect of poor fundamentals throughout the current quarter and uncertainty 

about the timing of a U.S.-led recovery are set to reassert themselves soon 

enough."

	    At any rate, the market is unlikely to move much lower going forward in 

the event of breaching 5,000 points as government support is almost a 

certainty when the president is outside the country, he added.

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