JPMorgan Securities (Taiwan) said yesterday that it expects the TAIEX to hit 9,800 points this year on the back of closer cross-strait economic ties and the recovery of the US economy.
The forecast was revised upward from an earlier estimate of 8,800 points, the brokerage said, adding that it does not rule out the possibility that the benchmark index could breach the 10,000-point mark this year.
JPMorgan said that after the implementation of the cross-strait Economic Cooperation Framework Agreement (ECFA), which Taiwan and China signed in June, further negotiations on increasing business exchanges are still underway.
Cross-strait talks are expected to continue to deliver “positive news, like the issuance of visas to individual Chinese tourists and more relaxation of cross-strait investment rules,” JPMorgan said.
Taiwan’s export-oriented economy will also benefit from the recovering US economy, which is expected to expand by an estimated 3.5 percent this year from an expected 2.6 percent rise last year, according to JPMorgan.
The brokerage said the US Federal Reserve is not expected to tighten liquidity until 2013, and the market worldwide is expected to remain awash in funds.
“We believe the investment strategy [for the Taiwan market] in 2011 will be a combination of sector rotation between tech and financial/non-tech,” JPMorgan said.
JP Morgan said concerns about the impact of the rising New Taiwan dollar on earnings in the local high-tech sector in the fourth quarter could provide investors with good buying opportunities.
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New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last