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Taiwan to relax rules to bolster stock market
[TAIPEI] Taiwan's financial regulator announced a package on Tuesday to help bolster the stock market after a recent heavy sell-off of stocks by foreign investors.
Net selling by foreign investors has reached T$14.3 billion (S$610 million) so far in October, compared to net sales of T$59 billion for all of September. That was a sharp turnaround from net purchases in each of the previous six months through August .
Under the eased rule, limits will be calculated separately for borrowing by investors to go long or short on stocks, the Financial Supervisory Commission (FSC) said in a statement.
The current limits are smaller, as they combine the two.
The FSC also said it would raise the margin trading ceiling for Over-the-Counter stock exchange trades, to 60 per cent of the stocks' prices from 50 per cent now. "We hope the package can boost turnover by 3 to 5 per cent," said the regulator's chairman William Tseng.
The new measures will take effect from Nov. 10.
Before the announcement, Taiwan's main index had ended Tuesday down 0.6 per cent. It had dropped below the key 9,000 point mark during the session. - Reuters