The nation's already sizzling stock market is expected to start bullish in the first trading day of the new year today, driven by anticipation of further cross-strait opening-up and investors' decreasing jitters concerning political risk, analysts said yesterday.
"We are bullish about the market that will continue to see an uptrend in the first quarter," Roger Chu (
The TAIEX is expected to start high and end with more than a 1 percent gain, or more than 70 points to 80 points, in the benchmark index today, Chu predicted.
With continued capital injection and expected uptick momentum, the TAIEX is expected to hit 8,000 points in the first quarter, the market watcher said.
On Friday, the stock market rounded off last year with the TAIEX closing up 90.79 points, or 1.17 percent, at 7823.72, a year high, registering a nearly 20-percent gain in the benchmark index over the course of the last 12 months.
The Cabinet later gave investors an end of year present by announcing further cross-strait relaxation, including allowing Taiwanese semiconductor makers to manufacture chips using 0.18-micron processing technology in China, a more advanced manufacturing technology than the currently approved 0.25-micron.
However, President Chen Shui-bian (陳水扁) said in his New Year speech yesterday that the government would retain restrictions on investment in China, citing an unnamed survey result that 56.7 percent of people were against loosening the cross-strait ties before public consensus was met.
Chen stressed the priority of putting Taiwan first and identification with Taiwan in formulating cross-strait economic policy.
"We do not expect Chen's remarks will have an impact on the market," said Kevin Li (
Further opening-ups are expected this year, Li said, predicting selected easing of restrictions that cap China-bound investment at 20 percent to 40 percent of a company's net worth and possible commencement of direct flights this year or next.
Both Shin Kong Investment and Taiwan Securities expect the TAIEX to hit 8,500 points in the fourth quarter of this year after correction in the second quarter.
Taiwan Securities expects to see decent performance by chipmakers, driven by the government's announced relaxation, including Taiwan Semiconductor Manufacturing Co (
Other picks include companies that enjoy a leading or even oligopoly status in their industries, like Uni-President Enterprises Corp (
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