The key weighted stock index lost 134.62 points, or 3.03 percent, to 4,305.18 after opening at 4,366.34 and fluctuating between 4,376.28 and 4,265.05 during trading.

A total of 3.18 billion shares changed hands on market turnover of NT$48.95 billion. Losers outnumbered gainers 1,159 to 228,with 281 stocks remaining unchanged.

Seven of the eight major stock categories lost ground. Foodstuff shares continued rising to become the only category to rise, gaining 0.2 percent.

Several stocks of food suppliers and retailers soared to their daily limit mainly because of Premier Liu Chao-shiuan’s announcement of a government plan to give each of the nation’s citizen NT$3,600 in shopping vouchers in a bid to stimulate domestic spending and economic growth.

The plan will pump NT$82.9 billion cash into the market in 2009.

But the gain of foodstuff and retailing shares was overshadowed by a steep decline of 4.7 percent in machinery and electronics shares on growing concern that Taiwan’s technology exports will drop amid a global recession that has cut down on demand and led local manufacturers to reduce hiring.

Other major losers included cement stocks, moving down the most at 5.1 percent.

Construction issues dropped 4.5 percent, paper and pulp issues lost 2 percent, plastics and chemicals shares shed 0.5 percent, and textile stocks and banking and financial shares both fell 0.4 percent.

The three major groups of institutional investors sold NT$3.803 billion more shares than they purchased.

Foreign investors were major net sellers of shares worth NT$4.26 billion. Securities investment consulting firms bought NT$213 million in stockholdings than they unloaded.

Securities brokerage houses with their own stock investment departments also net-bought NT$243 million worth of shares.

Major losers in the session included Taiwan Semiconductor Manufacturing Co., the world’s largest custom-chip maker, dropping 5.6 percent after saying it will hire fewer workers and giving some of the existing workforce more time off.

Hon Hai Precision Industry Co., the world’s largest contract electronics maker, fell by the daily limit.

Shares of AU Optronics Corp. fell 3.9 percent, to NT$18.30. The biggest maker of liquid crystal displays will cut the salaries of as many as 15 of its senior executives by 15 percent while directors will face a 10 percent pay reduction to save costs.

Major gainers included food companies like Wei Chuan Food, AGV, Taishan, and producers of cooking oil products.

Retailers with strongest rallies included Far Eastern Department Store, Ruentex which owns wholesale store chain RT-Mart, and Tsann Kuen, a leading retailer of computers, consumer electronics, and communications gears.

Fubon Financial Holding Co. rose 1 percent after the financial giant said it has received approval for its Hong Kong unit to acquire a 19.99 percent stake in Xiamen City Commercial Bank in China’s southeastern Fujian Province. Advanced Microelectronic Products Inc. surged 6.9 percent limit, its second daily limit increase, to NT$4.81 a share after the Hon Hai Group said it bought 38.6 million shares in the chipmaker through a private placement.

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