[周刊王CTWANT] Taiwan’s stocks have fallen 11% since September, and once fell below the National Security Fund’s 13,928 defense line. In addition, the maintenance rate of the entire household guarantee has fallen from 160% to 158%, and the share of the foreign borrowing and sales have soared. The Financial Supervisory Commission announced yesterday (30th) that it will implement two major measures to save the market: the short sale order invested abroad and the increase in the securities lending margin ratio.
This is also after the global epidemic began in March 2020, and after two and a half years of breaking, the Financial Supervisory Commission has imposed an air restriction order on foreign investment. From 2008 to this year, the Financial Supervisory Commission has acted to “save the market” five times. However, 2008 was a global systemic storm. The stock market did not rise after the act. In 2015, 2016 and 2020, the market rose by 3.8% to 26.24% range, and effectively reduced air power.
This time, the Financial Supervisory Commission observed the number of foreign borrowing and securities sales in the last few days of September, which accounted for 3.76% of the trading volume of Taiwanese stocks, which is similar to the proportion in 2020, but the amount of 91.8 billion yuan this year is almost 65% less than that in 2020. So the limit is only 20%, not 10% in 2020.
Zhang Zhenshan, director of the Securities and Futures Commission, said that two measures to stabilize the stock market will be launched from now on. First, reduce the daily volume of lending and the daily sale of investors, from “30% of the average volume of the first 30 days to 20%”, and secondly, The margin ratio of securities lending has been increased from 90% to 100 %, which can increase the cost of short-term parties, slow the selling pressure of Taiwan stocks, and boost investor confidence.
Among the two rescue measures, the first one has the biggest impact. According to the legal person, 90% of the short selling by lending securities is foreign capital. This move can limit the pressure of foreign capital on large stocks and reduce the volatility of individual stocks due to the level of borrowing of securities, which is effective In order to relieve the “air attack” pressure stocks, raise the stock market.
Second, the margin ratio of securities lending has been raised from 90% to 100% this time, which is also lighter than the increase of 120% when the mainland stock market crashed in January 2016. Zhang Zhenshan also explained that is the decline this year as deep as the previous year, and the financial management committee is timely and appropriate to implement appropriate policies.
Restricting lending and selling and increasing the margin ratio of securities lending are only medium-term measures, and are ultimately “conditional short-term ban” and “comprehensive short-term ban”. Zhang Zhenshan said that the interest rate hikes in major countries such as the United States have not ended yet. These two measures to stabilize the stock market have no time limit, and it is also difficult to predict an increase or decrease in Taiwan stock in the future. restore investor confidence and maintain market stability.
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