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Stabilization fund to continue in equity market

Stabilization fund to continue in equity market

Taipei, Sept. 21 (CNA) The National Financial Stabilization Fund will not be withdrawn from the stock market before the middle of October, Deputy Finance Minister Wu Tang-chieh (???), who manages the fund, said Monday. He made the remark as Taiwan shares dropped to below the 8,300-point mark at one point that day amid weak showings in Asian bourses following tumbles on Wall Street and in European markets. Since the National Financial Stabilization Fund Committee authorized the fund Aug. 25 to buy stocks in order to prop up share prices in Taiwan amid heavy volatility in global markets, the local stock market's performance has been relatively stable, according to Wu. The committee will keep close tabs on developments in the global economic situation and the domestic stock market now that the U.S. Federal Reserve decided last week to leave key interest rates unchanged, Wu said. Although the Financial Supervisory Commission (FSC) last week lifted a ban on short selling of stocks or Taiwan depository receipts that had fallen below the closing prices of the previous session, in a bid to ease irrational market movements, the fund will continue to buy shares if necessary before mid-October to help stabilize local shares, Wu added. He said that the committee is scheduled to hold a regular meeting in mid-October to decide whether the fund will continue to intervene in the market. In principle, the fund will invest in shares of companies with strong financial fundamentals and stable shareholder structures, and companies that have repurchased their own shares in line with the FSC's measures for executing share buybacks, according to Wu. (By Chiu Po-shen and Evelyn Kao)


Updated : 2021-09-23 10:56 GMT+08:00