Taiwan Stock Market Tipped To Extend Wednesday's Losses

(RTTNews) - The Taiwan stock market has moved lower in two of three trading days since the end of the two-day winning streak in which it had advanced more than 130 points or 0.7 percent. The Taiwan Stock Exchange now rests just beneath the 16,900-point plateau and it's looking at another rough start on Thursday.

The global forecast for the Asian markets is broadly negative following a downgrade in the United States' credit rating. The European and U.S. markets were firmly lower and the Asian markets are expected to open in similar fashion.

The TSE finished sharply lower on Wednesday with damage across the board, particularly among the technology, finance, plastic and cement companies.

For the day, the index stumbled 319.14 points or 1.85 percent to finish at 6,893.73 after trading between 16,844.57 and 17,212.55.

Among the actives, Cathay Financial tumbled 222 percent, while Mega Financial surrendered 2.46 percent, CTBC Financial fell 0.38 percent, First Financial weakened 1.20 percent, Fubon Financial dropped 2.11 percent, E Sun Financial lost 1.16 percent, Taiwan Semiconductor Manufacturing Company skidded 1.06 percent, United Microelectronics Corporation sank 0.74 percent, Hon Hai Precision tanked 2.26 percent, Largan Precision retreated 1.37 percent, Catcher Technology lost 0.57 percent, MediaTek shed 0.56 percent, Delta Electronics plunged 3.09 percent, Novatek Microelectronics slumped 1.14 percent, Formosa Plastics slipped 0.83 percent, Nan Ya Plastics gave away 1.27 percent, Asia Cement slid 0.63 percent, Taiwan Cement was down 0.93 percent and China Steel eased 0.53 percent.

The lead from Wall Street suggests consolidation as the major averages opened lower and remained in the red throughout the trading day, ending near session lows.

The Dow tumbled 348.16 points or 0.98 percent to finish at 35,282.52, while the NASDAQ sank 310.47 points or 2.17 percent to end at 13,973.45 and the S&P 500 dropped 63.34 points or 1.38 percent to close at 4,513.39.

The sell-off on Wall Street came after credit rating agency Fitch Ratings unexpectedly downgraded the United States' credit rating. Fitch downgraded the U.S.' long-term foreign-currency issuer default rating to AA+ from AAA, citing a "steady deterioration in standards of governance over the last 20 years."

In U.S. economic news, payroll processor ADP said U.S. private sector employment jumped more than expected in July. But while the report points to continued strength in the U.S. labor market, the data may lead to renewed concerns about the outlook for interest rates.

On Friday, the Labor Department is scheduled to release its more closely watched report on employment in July.

Crude oil prices tumbled on Wednesday amid concerns about outlook for demand, despite data showing a massive drop in crude stockpiles in the U.S. last week. West Texas Intermediate Crude oil futures for September ended lower by $.88 or 2.3 percent at $79.49 a barrel.