Taiwan share prices are expected to see volatile trade next week amid concerns over further downside on Wall Street which has been batttered by problems in the US subprime mortgage market, dealers said Friday.
For the week to August 10, the weighted index closed down 126.51 points or 1.40 percent at 8,931.31 after a 1.14 percent decline a week earlier. Average daily turnover stood at 152.05 billion Taiwan dollars (4.62 billion US), compared with 219.94 billion dollars a week ago.
The local bourse was likely to continue a sharp correction as margin calls are likely to impose further pressure on share prices, dealers said. The market is expected to move between 9,200 points and 8,700 points next week.
Grand Cathay Securities analyst Frank Wu said it remains to be seen when and how the subprime mortgage problems in the US will be resolved. "There are fears the mortgage problems in the US will trigger a credit crunch and pressure the economy. So, volatility is expected to dominate the global stock markets and the Taiwan market has no escape," Wu said.
Due to Friday's sell-off, margin calls are on the rise targetting small and medium stocks, he said, adding the market correction is not over yet. President Securities analyst Johnny Lee said cautious sentiment amid uncertainties over the overseas markets is expected to keep daily turnover at the current moderate levels.
Comments
Comments are closed.