Sat, Mar 20, 2004 - Page 10 News List

Markets to open on Monday as normal

SHORT-TERM SHOCK The shooting of the president and vice president will likely hurt sentiment next week, but analysts expect the damage to be short term only


The stock market will open for trading as normal on Monday, the Cabinet announced yesterday, after President Chen Shui-bian (陳水扁) and Vice President Annette Lu (呂秀蓮) were shot yesterday while campaigning in Tainan.

No matter which camp wins the election today, the shooting is expected to cast a pall on the nation's financial markets next week, analysts said yesterday.

"This horrendous incident will definitely hurt the financial market next week, as well causing uncertainty in the market in the short term," said Peter Hsieh (謝杰良), manager of Polaris-Protime Securities Consultant (寶來普泰投顧).

Many analysts were expecting to see a bull market led by pan-blue related stocks next week underpinned by general anticipation that the Chinese Nationalist Party (KMT)-People First Party (PFP) alliance would win the election, Hsieh said.

Transportation stocks, for example, surged 3.77 percent yesterday, more than any other sector, reflecting that investors expected the China-friendly pan-blue camp to open direct links, Hsieh said.

But Chen's shooting yesterday may bring in some sympathy votes, which has had market watchers hesitant to make predictions about the stock market's performance next week.

"The assassination attempt brings more variables to the result of the presidential election," Hsieh said. "If the incident and the result trigger riots tomorrow [Saturday], the TAIEX will go down next week for sure."

The shooting occurred after the stock market closed. The TAIEX rose 28.06 points, or 0.4 percent, to 6,815.09 points on turnover of NT$174.79 billion after fluctuating between 6,833.49 and 6,751.54 during the session.

Besides transportation stocks, companies that have heavy investments in China also made considerable gains.

China Airlines (華航) rose 6.6 percent to NT$25.80, while EVA Airways Corp (長榮) rose 6.6 percent to NT$22.50. Uni-President Enterprises Corp (統一集團) rose 5.74 percent to NT$22.1.

Financial shares that once led the market this year, however, tumbled by 0.91 percent. First Financial Holding Corp (第一金控) shed 2.7 percent to NT$25.10.

Jones Wang (王源錦), a deputy manager at ABN-AMRO Asset Management Taiwan, said the assassination attempt would affect the inflow of foreign cash in the short term.

"I think the result and how society reacts to the result is the point ... we hope the voting process goes smoothly," Wang said.

Stanley Yeh (葉德霖), an analyst at Yuanta Core Pacific Securities Corp (元大京華證券), however, was more optimistic amid the caution, saying that the government would activate the National Stabilization Fund if the market collapses on Monday.

Both local and foreign investors were looking forward to a surge after the election, with investment trust and proprietary traders buying a net NT$3.86 billion yesterday, while overseas investors pumped in NT$4.27 billion.

This story has been viewed 3074 times.

Comments will be moderated. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned.

TOP top