Many investors probably feel happy about their stocks as the TAIEX ended the year at an annual high of 8,188.11 points. Moreover, the benchmark index’s yearly increase of 3,596.89 points, or 78.34 percent, was the largest rally in 16 years.
Data from the Taiwan Stock Exchange Corp (TWSE) showed that the total market value of local stocks increased NT$9.33 trillion (US$291 billion), or 79.67 percent, last year to NT$21.33 trillion, translating into an increment of approximately NT$3.01 million for each of the 3.09 million investors who traded shares last year.
If the calculation was based on a population of about 8.52 million people who have opened securities accounts, each investor made an average of NT$1.09 million during the year. In either case, for many investors, investment in local stocks last year had its benefits.
What made last year notable is the fact that the stock market managed to move forward in the first quarter after Taiwan tumbled into its worst recession since 2001. After hitting a low at 4,242.61 points on Jan. 20, the market began to show signs of resilience amid warmer cross-strait relations and the recovering global economy.
From the second quarter onward, the market shrugged off internal and external pressures like political bickering and rising oil and raw material prices, and rallied on encouraging corporate earnings — despite the havoc wrought by Typhoon Morakot in August and the panic about the potential Dubai bankruptcy in November.
Even so, one should notice that the TAIEX’s annual high of 8,188.11 point on Dec. 31 was 11.9 percent below its 2008 high of 9,295.20 on May 19. The market has yet to return to its level before the global financial crisis.
Furthermore, even though the 78.34 percent surge on the TAIEX last year looked impressive, most markets in Asia also had a good year, with Indonesia leading regional markets with a rise of 87 percent, which was followed by India with 81 percent and Shanghai with 80 percent.
It would also be short-sighted to look at last year’s performance as the only evidence to foresee this year’s development, because like other economic data released recently, the comparison base for the previous year is too low to say the rebound is solid.
Indeed, the nation’s economic rebound late last year was merely a byproduct of government spending and recovering external trade, not consumer spending and private investment. Which means that if the government decides to withdraw its stimulus measures, we should be cautious about rising unemployment and weak consumption.
This year, investors will probably be in the mood to load up on more shares amid expectations of a persistent recovery in the world economy and the inking of an economic cooperation framework agreement (ECFA) with China. The market will also gain support from the likelihood of continued foreign capital inflows — as long as the value of US dollar remains low.
But there will be challenges this year, too. Weak growth in the US and European economies could dampen any chances of a strong recovery in Taiwan’s exports. While most economists forecast a return to growth for Taiwan this year, the economy won’t return to pre-crisis levels any time soon. Rising raw material and fuel prices could undercut consumers’ potential purchases. Moreover, the central bank will need to cap soaring asset prices and curb inflation without endangering the fragile recovery with its credit tightening measures. That will require care and wisdom.
Congressman Mike Gallagher (R-WI) and Congressman Raja Krishnamoorthi (D-IL) led a bipartisan delegation to Taiwan in late February. During their various meetings with Taiwan’s leaders, this delegation never missed an opportunity to emphasize the strength of their cross-party consensus on issues relating to Taiwan and China. Gallagher and Krishnamoorthi are leaders of the House Select Committee on the Chinese Communist Party. Their instruction upon taking the reins of the committee was to preserve China issues as a last bastion of bipartisanship in an otherwise deeply divided Washington. They have largely upheld their pledge. But in doing so, they have performed the
It is well known that Chinese President Xi Jinping’s (習近平) ambition is to rejuvenate the Chinese nation by unification of Taiwan, either peacefully or by force. The peaceful option has virtually gone out of the window with the last presidential elections in Taiwan. Taiwanese, especially the youth, are resolved not to be part of China. With time, this resolve has grown politically stronger. It leaves China with reunification by force as the default option. Everyone tells me how and when mighty China would invade and overpower tiny Taiwan. However, I have rarely been told that Taiwan could be defended to
It should have been Maestro’s night. It is hard to envision a film more Oscar-friendly than Bradley Cooper’s exploration of the life and loves of famed conductor and composer Leonard Bernstein. It was a prestige biopic, a longtime route to acting trophies and more (see Darkest Hour, Lincoln, and Milk). The film was a music biopic, a subgenre with an even richer history of award-winning films such as Ray, Walk the Line and Bohemian Rhapsody. What is more, it was the passion project of cowriter, producer, director and actor Bradley Cooper. That is the kind of multitasking -for-his-art overachievement that Oscar
Chinese villages are being built in the disputed zone between Bhutan and China. Last month, Chinese settlers, holding photographs of Chinese President Xi Jinping (習近平), moved into their new homes on land that was not Xi’s to give. These residents are part of the Chinese government’s resettlement program, relocating Tibetan families into the territory China claims. China shares land borders with 15 countries and sea borders with eight, and is involved in many disputes. Land disputes include the ones with Bhutan (Doklam plateau), India (Arunachal Pradesh, Aksai Chin) and Nepal (near Dolakha and Solukhumbu districts). Maritime disputes in the South China