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Investors optimistic about stock market

TAIPEI, Taiwan -- Despite tens of thousands of protestors assembled on Ketagalan Boulevard in front of the Office of the President yesterday to oppose to the signing of the cross-strait service trade agreement, stock analysts remain optimistic about the Taiwanese stock market's future performance.

Investors with foreign capital overbought NT$10 billion last Friday, which analysts said is a sign that foreign investors are still confident about Taiwan's economic performance in the long-run.

According to Kevin Lin (林成蔭), vice president of Caizischool Co Ltd., student demonstrations are set to continue in the short-term, and while foreign investors overbought last Friday, domestic investors were more conservative in their purchase approach.

An analyst from Hantec Securities Consultant Limited said that the impact of the signing of the service trade agreement would not be felt immediately, and the fact that foreign investors overbought NT$10 billion indicates that they are optimistic about Taiwan's stock performance in the long-run. It is still possible that the stock market will reach 9,000 points, the analyst said.

Tachan Securities (大展投顧) analyst Lee Cheng-yen (李政諺) said it would require a trade volume between NT$110 and NT$120 billion per day before the stock market accumulates enough momentum to reach a watershed point, otherwise, stock prices may swing back down.

Taiwan Securities Association Chairman Chien Hung-wen (簡鴻文) expressed his support for the inking of the service trade agreement, calling on the government to sign free trade agreements with other countries as well. Chien also called on the public to help the Legislature resume normal operation, so that the service pact may be reviewed and approved through democratic procedures.

Analysts forecast that student protests will continue for a while longer, and the stock market is likely to be affected in the short-term. How it will perform on Monday will be a focus among local investors.

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