Continued Consolidation Called For Taiwan Stock Market

(RTTNews) - The Taiwan stock market headed south again on Wednesday, one session after snapping the two-day slide in which it had stumbled almost 250 points or 1.8 percent. The Taiwan Stock Exchange now rests just beneath the 14,425-point plateau and it's tipped to open under pressure again on Thursday.

The global forecast for the Asian markets is soft on renewed recession fears following another big rate hike from the FOMC. The European markets were up and the U.S. bourses were down and the Asian markets are tipped to follow the latter lead.

The TSE finished modestly lower on Wednesday following losses from the financials, technology stocks and cement companies, with mild support from the plastics.

For the day, the index sank 124.78 points or 0.86 percent to finish at 14,424.52 after trading between 14,384.11 and 14,525.46.

Among the actives, Cathay Financial weakened 1.16 percent, while Mega Financial shed 0.58 percent, CTBC Financial lost 0.68 percent, Fubon Financial sank 0.70 percent, First Financial collected 0.94 percent, E Sun Financial fell 0.36 percent, Taiwan Semiconductor Manufacturing Company skidded 1.15 percent, United Microelectronics Corporation retreated 1.37 percent, Hon Hai Precision stumbled 1.38 percent, Largan Precision declined 1.31 percent, Catcher Technology tanked 2.27 percent, Delta Electronics slumped 1.48 percent, Formosa Plastics perked 0.12 percent, Nan Ya Plastics rose 0.15 percent, Asia Cement dipped 0.23 percent, Taiwan Cement dropped 1.17 percent and MediaTek and Novatek Microelectronics were unchanged.

The lead from Wall Street ends up negative as the major averages were steady throughout Wednesday session until the FOMC's rate decision sent them tumbling, closing near daily lows.

The Dow plummeted 522.45 points or 1.70 percent to finish at 30,183.78, while the NASDAQ tumbled 204.86 points or 1.79 percent to close at 11,220.19 and the S&P sank 66.00 points or 1.71 percent to end at 3,789.93.

The late-day volatility came after the Fed raised interest rates by another three-quarters of a percentage point and signaled further aggressive rate hikes for the remainder of the year.

Citing its dual goals of maximum employment and inflation at a rate of 2 percent over the longer run, the Fed decided to raise its target range for the federal funds rate by 75 basis points to 3 to 3.25 percent.

The move marks the third straight 75 basis point rate hike by the Fed and lifts rates to their highest level since early 2008. With inflation remaining elevated, the Fed also said it expects that ongoing interest rate increases will be appropriate.

Crude oil prices drifted lower Wednesday amid concerns about the outlook for energy demand after the Federal Reserve's announcement of a sharp hike in interest rates raised fears about a recession. West Texas Intermediate Crude oil futures for November ended lower by $1.00 or 1.2 percent at $82.94 a barrel.

Closer to home, The de facto central bank in Taiwan will announce its decision on interest rates later today, with expectations that it will hike its benchmark from 1.5 percent to 1.625 percent. Taiwan also will see unemployment data for August; in July, the jobless rate was 3.68 percent.