Share prices were lower in late morning trade.

Financials failed to sustain their early recovery as concerns resurfaced about the implications of the ongoing investigation into alleged money-laundering by the family of former president Chen Shui-bian, dealers said.

At 11.06 am, the weighted index was down 80.24 points or 1.16 pct at 6,838.24, off a high of 6,994.80 and a low of 6,837.54.

Turnover was 44.85 bln twd.

The financial subindex was down 0.72 pct and electronics was 1.33 pct lower.

The food sector tumbled 3.96 pct, led by Uni-President after its Hong Kong-listed unit reported an 18 pct decline in first-half profit.

Transport fell 2.08 pct after oil prices rebounded overnight.

"A homegrown political scandal and a still volatile Wall Street continue to keep investors bearish, easily undercutting any attempted technical bounce," said National Investment Trust vice president Eddy Chen.

He said the Financial Supervisory Commission's preliminary conclusion that merger and acquisition deals during Chen's presidency contained no administrative errors was not sufficient to dispel fears that a bigger storm could be brewing.

"Oil has gone up again, and local companies have yet to finish reporting quarterly results," he said. "Cashing out of so many uncertainties makes perfect sense."

Financials were mixed.

Taishin Financial was up 0.21 twd or 2.25 pct at 9.56, Chinatrust Financial was unchanged at 19.55 and Cathay Financial was down 0.40 twd at 58.70.

TSMC was up 0.20 twd at 59.60, underpinned by an ongoing repurchase program. UMC was down 0.15 twd at 12.70.

Uni-President was down 2.05 twd or 6.01 pct at 32.05.

EVA Air was down 0.35 twd or 3.13 pct at 10.85 and China Airlines was 0.05 twd lower at 10.40.

(1 usd = 31.40 twd)