Wed, Nov 19, 2014 - Page 14 News List

Survey finds declining confidence in economy

By Amy Su  /  Staff reporter

Public confidence in the economy and the stock market weakened this month, amid increasing uncertainty over the European economy, food safety scandals and the Nov. 29 elections, a monthly survey by Cathay Financial Holding Co (國泰金控) found.

The firm yesterday said this month’s economic optimism index decreased slightly to minus-0.8 points from the 0.1 points posted last month.

A total of 32.9 percent of the respondents maintained a neutral view on the economy’s prospects for the next six months, outnumbering 29.7 percent who held a bullish view and 30.5 percent who were pessimistic, the report said.

“Various non-economic factors have obscured the nation’s healthy economic fundamentals, leading to the public’s uncertain feelings,” the report said.

Other than the downside risk of the European economy, ongoing food safety scandals and the nine-in-one elections were the two major factors dragging down public confidence, the report said.

The latest downturn in the TAIEX further reduced public confidence in the stock market for the near future.

About 37.2 percent of respondents said the TAIEX would drop in the next six months, while only 26 percent believe the index is set to go up, the survey found.

However, 56.8 percent of respondents said they intend to maintain the current holdings on the stock market this month, with 25.8 planning to cut investment and 17.4 percent to increase stakes, the data showed.

Most respondents attributed the TAIEX’s recent sluggish performance to ongoing food safety scandals, with the Ebola outbreak and the global economy’s weaker-than-expected momentum also major factors, the report said.

Nearly half of respondents said they would buy shares when the TAIEX dropped to 7,500 points or lower, with 22.9 percent still willing to invest at the level of 8,500 points, the survey found.

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