Taiwanese confidence in equity market down sharply, claims survey
Taiwanese investors’ confidence in the equity market fell sharply amid lingering concerns over the economic climate at home and abroad and due to a shock resulting from recent volatility in the global financial markets, according to a survey released by J.P. Morgan Asset Management.
The survey showed that the equity investment index in Taiwan fell 24.7 points from a quarter earlier to 81.7 in the third quarter, the lowest level since J.P Morgan Asset Management started such a survey in July 2004.
The weighted index on the Taiwan Stock Exchange hit a 2015 high of 9,973.12 points on April 27. But since then, the local main board has started trending lower amid worries over the debt problems in the eurozone and fears of an interest hike by the U.S. Federal Reserve.
A steep fall in the Chinese yuan and turmoil in the global equity markets, in particular the China market, sent the local weighted index into a tailspin.
Since April 27, the weighted index on the local main board has shed almost 2,000 points or more than 19 percent. Since the beginning of this year, the index has fallen nearly 14 percent to close at 8,019.18 points on Friday.
In addition to cautious sentiment toward the economy, J.P. Morgan Asset Management cited concerns over political uncertainty ahead of the upcoming presidential election scheduled for January 2016.
The sub- index for the sentiment toward the capital market in Taiwan fell 29.7 points from a quarter earlier, the sub- index for the local economic outlook dropped 28.6 points and the sub-index for possible gains resulting from investments over the next six months declined 24.1 points, the survey showed.
The survey indicated that the sub-index for the global economic outlook fell 23.8 points from a quarter earlier, the sub-index for the outlook of the local bourse dropped 22.6 percent, and the subindex for the local political situation and cross strait relations shed 19.8 points.
According to the survey, 47 percent of Taiwanese investors suffered losses in their investments in the local equity market over the past six months, the worse performance in two years.
The survey was conducted between July 21 and Aug. 3 and collected a total of 1,069 valid questionnaires with a confidence level of 95 percent and a margin of error of 3 percentage points.