The Financial Supervisory Commission yesterday confirmed that it is planning to split the current single stock-trading session on the local bourse into two, one in the morning and one in the afternoon, as well as expanding the daily trading limit, without providing a schedule for the new policy.
"The proposed plan aims to make the local bourse more internationalized ... as our major neighbors like Japan, South Korea, Hong Kong and Singapore all use two stock-trading sessions [in the morning and afternoon]," the commission's minister, Kong Jaw-sheng (龔照勝), told a press conference yesterday.
The plan proposed by the Taiwan Securities Association (
The local bourse currently has one single trading session opening at 9am and closing at 1:30pm, without any breaks.
The daily trading ceiling of 7 percent would apply to both sessions. There would be a total 14.49 percent daily ceiling in the wake of a longer session either in the morning or afternoon, which is close to the ceiling the commission had planned to introduce, Kong said.
The financial regulator proposed earlier this year that the TAIEX' daily trading ceiling be increased to 15 percent a day from 7 percent, citing the internationalization of the local stock market.
The break between the two sessions could be used for announcing significant information by the listed companies and for cooling the market down if the bourse boiled over with negative information, the commission said.
Kong, however, shied away from giving a clear timetable for the policy change, saying that it required time to study and formulate the details and supportive measures, such as whether to change the regulations for trading on margins and allow investor conferences during sessions if they were extended.
Local securities houses, however, had mixed views about the potential changes.
"We stand in favor of the proposal ... as a measure to facilitate the widening of the daily trading ceiling to 15 percent for further liberalization," Joseph Yeh (葉震宙), managing director of BNP Paribas Securities Taiwan Co, said in a telephone interview yesterday.
However, 70 percent of securities houses reportedly expressed a concern that too many trading changes could hurt the local bourse, Chinese-language newpapers reported yesterday.
For instance, the proposal would impact on individual investors' daily schedules, which could in turn deter the majority of investors from investing in the already sluggish TAIEX, they said.
In response, the securities association's chairman Chien Hung-wen (簡鴻文) said that his group would communicate with the securities house on the trading change, but would not force the promotion of the policy change if up to 70 percent of member companies should oppose the plan.
RSS