The committee of the National Stabilization Fund (國安基金) yesterday decided not to enter the market to prop up share prices, which have been taking a beating amid concerns over more aggressive US Federal Reserve monetary policy to deal with skyrocketing inflation.
In a statement released after the committee’s meeting, the Ministry of Finance said that despite external factors, the nation’s economic fundamentals remain sound and it was not necessary for the stabilization fund to intervene in the market at this time.
The NT$500 billion (US$16.77 billion) stabilization fund was set up by the government in 2000 to serve as a buffer against unexpected external factors that might disrupt the local bourse.
The nation’s exports are still growing, registering a 15.2 percent year-on-year increase last month to US$42.2 billion, which was the 24th consecutive month of year-on-year growth, the ministry said.
The nation’s economy is expected to grow 3.91 percent this year, the Directorate-General of Budget, Accounting and Statistics has forecast, which is higher than the 2.9 percent estimate for the global economy, as projected by global information services firm IHS Markit in May, it said.
In addition, companies listed on the main board and the over-the-counter market posted combined sales of NT$3.48 trillion for May, which was a monthly high, and falling share prices have made the local equity market more attractive, it added.
Furthermore, with the number of daily domestic COVID-19 cases falling, domestic demand is expected to improve, the ministry said.
However, the stabilization fund committee would continue to monitor stock market fluctuations, it said.
The last time the fund intervened was March to October 2020, when investor confidence was being battered in a market roiled by the COVID-19 pandemic.
After the entry of the fund, the TAIEX soared 4,274.57 points, or 49.24 percent, from a low of 8,681.34 on March 19 to 12,955.91 on Oct. 12.
The stabilization fund bought only NT$757 million of shares during that period, as the market was boosted largely by foreign fund inflows.
CAUTIOUS RECOVERY: While the manufacturing sector returned to growth amid the US-China trade truce, firms remain wary as uncertainty clouds the outlook, the CIER said The local manufacturing sector returned to expansion last month, as the official purchasing managers’ index (PMI) rose 2.1 points to 51.0, driven by a temporary easing in US-China trade tensions, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The PMI gauges the health of the manufacturing industry, with readings above 50 indicating expansion and those below 50 signaling contraction. “Firms are not as pessimistic as they were in April, but they remain far from optimistic,” CIER president Lien Hsien-ming (連賢明) said at a news conference. The full impact of US tariff decisions is unlikely to become clear until later this month
With an approval rating of just two percent, Peruvian President Dina Boluarte might be the world’s most unpopular leader, according to pollsters. Protests greeted her rise to power 29 months ago, and have marked her entire term — joined by assorted scandals, investigations, controversies and a surge in gang violence. The 63-year-old is the target of a dozen probes, including for her alleged failure to declare gifts of luxury jewels and watches, a scandal inevitably dubbed “Rolexgate.” She is also under the microscope for a two-week undeclared absence for nose surgery — which she insists was medical, not cosmetic — and is
GROWING CONCERN: Some senior Trump administration officials opposed the UAE expansion over fears that another TSMC project could jeopardize its US investment Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is evaluating building an advanced production facility in the United Arab Emirates (UAE) and has discussed the possibility with officials in US President Donald Trump’s administration, people familiar with the matter said, in a potentially major bet on the Middle East that would only come to fruition with Washington’s approval. The company has had multiple meetings in the past few months with US Special Envoy to the Middle East Steve Witkoff and officials from MGX, an influential investment vehicle overseen by the UAE president’s brother, the people said. The conversations are a continuation of talks that
CHIP DUTIES: TSMC said it voiced its concerns to Washington about tariffs, telling the US commerce department that it wants ‘fair treatment’ to protect its competitiveness Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reiterated robust business prospects for this year as strong artificial intelligence (AI) chip demand from Nvidia Corp and other customers would absorb the impacts of US tariffs. “The impact of tariffs would be indirect, as the custom tax is the importers’ responsibility, not the exporters,” TSMC chairman and chief executive officer C.C. Wei (魏哲家) said at the chipmaker’s annual shareholders’ meeting in Hsinchu City. TSMC’s business could be affected if people become reluctant to buy electronics due to inflated prices, Wei said. In addition, the chipmaker has voiced its concern to the US Department of Commerce
RSS