Local stock values shed NT$4.63 trillion in 2011

The China Post news staff

Taiwan investors lost an average of more than NT$580,000 each in stock investments this year during which share prices dropped over 21 percent, a report said yesterday. Stock values shrunk NT$4.63 trillion, translating into an average loss of about NT$200,000 for each of the 23 million people in Taiwan, the United Evening News said. The local stock market held onto the 7,000-mark on the last trading day of the year yesterday, but that means it has shed about 1,900 points, or more than 21 percent, this year, inflicting heavy losses on its almost nine million investors. The year started amid bullish sentiment, with the weighted index shooting up above 9,220 points in January, inviting speculations and hope it would soon break the 10,000-mark. But the March 11 earthquake and tsunami in Japan sent economic shockwaves across the globe, with the Taiwan bourse swiftly dropping below 8,100 points. The local bourse later turned steady, only to be hit again by the looming debt crisis in Europe. Foreign funds fled the Taiwan stock market, sending share prices plummeting. The local weighted index plunged to as low as 6,609 points last week before the government’s vow to inject capital from the National Stabilization Fund worked to shore up share prices. Schive Chi, chairman of the Taiwan Stock Exchange (TSE), gave the local bourse a mark of 71 out of 100, saying its performance still deserved a pass.

From a long-term perspective, many companies are still optimistic about Taiwan’s stock market, judging from the increases in the number of firms issuing IPOs and the amount of capital raised, Schive noted.

Compared to many other countries’ markets, the local bourse has been rather stable, he added. A total of 772 companies are listed in the local bourse, but their market values have plunged to about NT$19 trillion from NT$23.18 trillion at the end of last year. Daily transaction in 2010 was NT$115.1 billion, but in 2011 it dropped to NT$109.5 billion, although the number of investors’ accounts rose to 8.91 million from last year’s 8.68 million. The reduced transaction, particularly during the last month of the year, shows that many investors have given up. Vice Premier Sean Chen said that he remains optimistic about the outlook for Taiwan’s stock market when it opens Monday for the first time in 2012.