Taiwan stocks not at their worst: minister of finance
The China Post news staff and CNA
November 2, 2012, 11:56 am TWN
Taiwan stocks are not currently at their worst, Minister of Finance Chang Sheng-ford said yesterday.
Chang made the remarks after the TAIEX yesterday morning fell by over 100 points, which led to criticism that the government has not done enough to prop up stocks. The TAIEX, however, closed up 13.59 points on what was widely believed to be government intervention.
Yesterday at the Legislative Yuan, Chang said that Taiwan stocks' recent tepid performance was the result of international factors.
"Taiwan is a relatively small economic entity whose gross domestic product is 70-percent dependent upon exports," he said. "Even if overseas markets cough a little, Taiwan gets nervous."
He said quasi-state banks have already entered the market to buy stocks, and the use of the National Stabilization Fund would be the very last resort
"Both myself and Chen Yu-chang, chairman of the Financial Supervisory Commission, have met with Vice Premier Chiang Yi-hua, who said that before the use of the National Stabilization Fund, there are many tools available at our disposal," he said. "The National Stabilization Fund should be used with prudence and caution."
The TAIEX is still above 7,000, and trade volume has been okay, given the daily average of some NT$90 billion from January to October, he said.
In local stocks, shares on the Taiwan Stock Exchange recovered from earlier losses to end in positive territory yesterday as the electronics sector staged a rebound to push the broader market out of a slump, dealers said.
The weighted index closed up 13.59 points, or 0.18 percent, at 7,179.64, after moving between 7,050.05 and 7,188.23 on turnover of NT$72.78 billion.
"Judging from the gains posted by select large-cap high tech stocks, I suspect the buying largely came from government-led funds in a bid to shore up investor confidence," President Securities analyst Vickie Hsieh said.
"It seems that the government was trying hard to prevent the index from falling below 7,000 points. Otherwise, further selling will follow amid lingering concerns over the economy's fundamentals," Hsieh said.
The market opened down 0.53 percent and moved to the day's low in early morning trade as market sentiment remained cautious about the global economy, the dealers said.