Following trends set Thursday by stock markets in Europe, the weighted index of the Taiwan Stock Exchange fell by 248.25 points, or 3.2 percent, to 7,490.91 points Friday. The steep one-day drop erased all gains made by the index since November 6. A total of 2,569 shares lost ground, while 413 rose and 49 closed unchanged.

As expected, the financial and banking shares took the brunt of the onslaught, plunging 4.68 percent.

Textile issues fell 4.23 percent, construction shares declined 4.13 percent, and food stocks dropped 4.1 percent.

The cement sector lost 3.35 percent, paper issues fell 3.29 percent, while plastics and chemicals declined 3.17 percent. The machinery and electronics suffered the least, but nevertheless also dropped 2.8 percent.

Cathay Financial said its related companies were exposed to the tune of US$28.55 million (NT$923 million).

Taishin Holdings estimated its Taishin International Bank’s exposure through a syndicated loan at US$15 million (NT$485 million). The group said the Dubai problem would not affect its overall situation.

Shin Kong Financial said the involvement of its Shin Kong Bank amounted to US$5 million (NT$160 million), but its life insurance unit had no links to the Dubai loans.

The Taiwanese holdings said the Dubai problem would not affect their overall financial situation.

Other financial groups such as Cathay Financial and state-run concerns were still determining their level of exposure, reports said. China Development, Yuanta, SinoPac and Waterland said they had no exposure.

The Financial Supervisory Commission meanwhile said the involvement of Taiwanese banks would not be higher than that of South Korean financial institutions. Overseas media reports put the level of South Korea’s involvement in Dubai World at US$32 million. Taiwanese companies had not invested much in Dubai, said Hsiao Chang-juei, the deputy director general of the FSC’s Banking Bureau.