Taiwan stocks end flat, Quanta rises on better outlook

* TAIEX ends at one-month closing low

* Hon Hai rises following solid Q3 results

* Mediatek rises on positive brokerage notes

* Banks, China plays fall on news of a delayed China pact
(Updates indexes, adds quotes and details)

TAIPEI, Nov 2 (Reuters) - Taiwan stocks erased most of their
early losses to end flat on Monday, with technology companies
such as Quanta (2382.TW) leading gains after the company reported
solid quarterly earnings and forecast a stronger outlook.

The main TAIEX share index inched down 4.9 points to
close at 7,335.18, after hitting its lowest intraday level in
1-½ months in the early session as banks and China plays fell
on the delayed negotiation of an economic pact with China.

Quanta, the world's largest contract laptop PC maker, jumped
4 percent after it said it expected unit shipments to climb about
40 percent in 2010 due to strong demand. [ID:nTP351825]
The electronics sub-index .TELI was up 0.07 percent.

"We could bet on solid corporate earnings in the short term,
but as the earnings season winds down, we need to bring our focus
to economic fundamentals," said Eddy Chen, a vice president at
National Investment Trust Co Ltd.

Turnover was light at T$84 billion ($2.6 billion), compared
with Friday's T$102 billion and last week's daily average of
T$112 billion.

Analysts said investors have grown cautious toward Taiwan
stocks on concerns that economic growth won't be able to sustain
the main index's 65 percent rally so far this year.

"Investors would scrutinise economic data such as the ISM
(Institute for Supply Management) report from the United State
for further directions," said Chen.

Financial shares and China plays were hurt by a local
newspaper report that China had called off the fourth round of
informal negotiations with Taiwan on a much anticipated free
trade agreement-like deal called the Economic Cooperation
Framework Agreement (ECFA).

Chinatrust Financial (2891.TW), the island's top credit card
issuer, dropped 1 percent, sending the banking and insurance
sub-index .TFNI down 0.12 percent.

China plays, including tourism shares .THOI and
transportation shares .TTPI, fell 0.74 percent and 0.88
percent, respectively.

Technology shares shrugged off sharp losses on Wall Street,
with electronics parts giant Hon Hai (2317.TW) rising 0.38
percent after it reported stronger-than-expected quarterly
results on Friday. [ID:nTPU001816]

Chip designer Mediatek (2454.TW) topped the list of
most-active stocks by turnover, jumping 4.62 percent after Morgan
Stanley and Merrill Lynch raised their ratings on the stock on
strong demand for handset units and fair valuation.

Mediatek said on Friday it expected its fourth quarter gross
profit margins and sales to be slightly lower than the third
quarter. [ID:nTPU001809].

But Powerchip (5346.TWO), Taiwan's biggest DRAM chipmaker,
slipped 4.56 percent after it reported a net loss for the past
three months. [ID:nTPU001815]

HOT STOCKS

-- Taiwan's ASE (2311.TW), the world's largest chip packaging
and testing company, jumped 3.44 percent after it said on Friday
it had increased its 2009 capex budget and posted a
market-beating third-quarter net profit. [ID:nTPU001811]

-- Senao (2450.TW) advanced 1.81 percent after analysts
predicted its earnings per share to reach T$4.40 this year after
the distributor of electronic products booked earnings per share
of T$3.34 for the first three quarters of the year.
---------------------TAIEX IN PERSPECTIVE----------------

Move on day -0.07 pct

Close on day 7,335.18

2009 intraday high 7,811.92

2009 intraday low 4,164.19

All-time high 12,682.41 12 FEB 1990
----------------------------------------------------------

For a table of foreign trading in Taiwan stocks, double-click
on [ID:nTP170358]