Public confidence in the economy and stock investment picked up this month, encouraged by healthy economic data and corporate earnings results, a survey by Cathay Financial Holding Co (國泰金控) showed yesterday.
A total of 55.7 percent of the 15,933 people polled from Oct. 1 to 7 expect Taiwan’s economy to improve in the next six months, outnumbering 35.3 percent of them with negative views, the survey found.
HSBC Holdings PLC chief economist on Asia Frederic Neumann said that Taiwan’s competitive edge is shielding its tech firms from price competition from China, which would continue to propel the nation’s GDP next year.
Photo: CNA
Manufacturers elsewhere are taking a hit from China’s overproduction and market share gains, Neumann said, citing the struggling eurozone.
Against this backdrop, 42.3 percent of the respondents said they believe the TAIEX would climb higher in the next six months, 24.2 percent forecast price corrections and 21.1 percent expressed neutral views, the survey showed.
Financial markets usually reflect the health of an economy, Neumann said, citing the US market where resilient GDP growth is bolstering US bourses and the US dollar.
HSBC does not see major risks of an economic slowdown in the US or Taiwan with the artificial intelligence (AI) boom continuing and expanding, Neumann said.
For the rest of the year and beyond, “the dragon still has fire in the belly,” he said.
Taiwan’s private investment, which largely has to do with exports of tech products, came out of the woods in the second quarter and would pick up further momentum, HSBC said.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) last week said that it would increase its capital expenditure next year.
The AI boom is just at the beginning, it added.
The positive sentiment is also seen with 31.3 percent of respondents saying they would increase their big-item consumption, while 22.3 percent said they would reduce spending and 46.4 percent said they would keep it the same.
Furthermore, 32.5 percent said they would channel their money from time deposits to stock investments, significantly higher than 14.8 percent of respondents who said they plan to trim their stakes in risky assets.
However, 15.9 percent said it is wise to buy a house now, while 36 percent think it is wise to sell, suggesting a mismatch and a potential rise in selling pressure in the housing market.
The development came after the central bank tightened lending terms to induce a soft landing in house prices and transactions.
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