Want China Times
An investor checks the stock prices at a trading center in Taipei, June 4. (File photo/CNA)
The Taiwan Stock Exchange on June 1 relaxed its daily trading limit to 10% and raised its account collateral maintenance ratio to 130%, allowing the stock market to better react to bullish or bearish factors, and make market order more transparent and neutral. Originally the move was expected to bring the Taipei stock market closer to international bourses but Taiwan stocks have performed poorly with shrinking turnover and stagnant momentum.
The cold market response to the liberalization is partially attributable to the stagnant international stock market. Minister of Finance Chang Sheng-ford believes investors may not yet be familiar with the new rule and may need some more time to adjust to it. However, recent statistics showed that Taiwan’s exports fell, export orders dropped, while the government’s statistics agency unexpectedly lowered its projection for Q2 GDP growth on unfavorable fundamentals. He added that the Taiex is seen to possess higher risks approaching the 10,000-point benchmark, while the electronics industry is facing a slow season in May and June, creating unfavorable factors for the stock market. [FULL STORY]