Premier Frank Hsieh (謝長廷) yesterday urged investors not to panic in the runup to Saturday's local government elections, after a newspaper report cited analysts predicting that stock prices will rise if the Chinese Nationalist Party (KMT) wins the balance of the polls.
Hsieh was referring to a story that appeared in the blue-leaning Chinese-language China Times, which said that advisers at Merrill Lynch suggested that if the Democratic Progressive Party (DPP) loses, stock prices will immediately go up.
The report also said that the economy will improve only if people vote against the DPP, forcing it to abandon its economic policies.
"I think the newspaper story is misleading the public," Hsieh said. "We should not be so pessimistic. We should not let politics impact our stock market." Hsieh made his remarks during a press conference in Taichung.
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The premier said his chief concern was that regular life may not resume immediately after the polls.
"Whether the Democratic Progressive Party [DPP] wins or loses, the most important thing is to resume our normal lives after the election," Hsieh said. "If people begin to argue that we should have a new premier, a new minister and so on, how can you expect the stock market to climb?"
The premier also repeated that he will not step down after the election. He will "make adjustments" to the Cabinet, but has not decided on any details in this regard.
Meanwhile, in response to Merrill Lynch's analysis, the Financial Supervisory Commission (FSC) yesterday said that foreign investors are still bullish about the nation's stock market.
In a press release issued yesterday, the top financial regulator said that between Nov. 1 and Nov. 24, net foreign investment totalled US$4.6 billion, with the cumulative year-to-date total hitting US$19.6 billion.
From Nov. 1 to Nov. 24, foreign investors' net buying of listed shares amounted to NT$161.7 billion, while their net buying volume for the year to date reached NT$462.8 billion, the press release said.
The FSC also said that Merrill Lynch's report was upbeat about the nation's future economic development. According to the FSC, the report said that as the global economy recovers, the nation's exports are expected to continue higher, which will be reflected in the stock market.
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