Cautious sentimentt is expected to dominate the Taiwan stock market as high-level talks with China go ahead amid vows by the anti-Beijing opposition to stage massive protests, dealers said. Turnover is likely to keep falling as many foreign investors retreat from the market with the Christmas holidays approaching, they said.
Concern over further volatility on Wall Street after a lacklustre response to a Citigroup share sale may add pressure to the local bourse, they added. The market is expected to face heavy resistance at the 7,800-7,900 points range next week with small and medium-sized stocks more active in thin trade, dealers said. For the week to December 18, the weighted index lost 41.44 points or 0.53 percent to 7,753.63 after a 1.88 percent increase a week earlier.
Average daily turnover fell to 119.19 billion Taiwan dollars (3.69 billion US) from last week's 142.41 billion dollars.
"Investors fear the demonstrations will lead to violence and impact on the market," Capital Securities analyst Chen Yu-yu said. High-level talks between Taiwan and China focussing on economic issues will be held early next week in the city of Taichung in the centre of the island.
The opposition Democratic Progressive Party plans to hold a huge rally Sunday, hoping to attract up to 100,000 people, while several other groups have also vowed to organise demonstrations, starting Monday. "Non-economic factors such as these may drag the market below 7,500 points," Chen said.
Comments
Comments are closed.