The Financial Regulatory Commission sent a report to the Legislative Yuan of “Tax Reduction and Tax Expenditure”, which mentioned that the average daily trading volume of the Taipei stock market may shrink to below NT$300 billion in 2022, which is 40% less than this year. In this regard, the FSC said today (28) that it mainly refers to the US QE scale reduction and trial calculations based on the figures of the previous two years. Next year, the price and volume may not be fully reflected. The FSC will closely monitor foreign investment trends.
The FSC explained that the original tax expenditure estimate was based on the possible reduction or suspension of the quantitative easing (QE) policy in the United States. Therefore, the average daily trading value of Taiwan stocks last year was 2007 billion yuan and the average daily trading value of 2019 was 120 billion yuan. Because 120 billion yuan only accounts for about 60% of 2007 billion yuan, so with this ratio of 60%, using this year’s average daily trading volume to try to figure out next year’s average daily trading volume, it will fall below 300 billion yuan to 287.7 billion yuan. This is a 40% reduction from this year.
The outside world is concerned that the estimation of this data is still in the context of preferential tax cuts. Since the tax cuts are currently subject to negotiation by the party group, that is to say, if there is no tax cut, the trading volume of Taiwan stocks is likely to be high. Cut directly at the waist.
The Financial Regulatory Commission stated that there are many variables that affect the trading volume of Taiwan stocks. In addition to the force of QE exit, the economic conditions of various countries, the stock market price-to-earnings ratio, and the yield rate will affect the momentum of the stock market. Make a comparison between the two years, but this number may not necessarily reflect the situation next year.
The Financial Regulatory Commission emphasized that the current Taiwan’s equity price-to-earnings ratio is 15.38 times, the cash yield rate is 2.75%, and the stock yield rate is 2.86%. The accumulated revenue of listed companies is 28.79 trillion yuan, an annual increase of 13.37%, indicating that the fundamentals of Taiwan stocks are very stable; In addition, according to the economic growth rate of 5.88% issued by the Accounting Office this year, the Ministry of Finance announced that exports in September reached 39.7 billion U.S. dollars, which also hit a new monthly high in the past year, with an annual increase of 29.2%; and the National Development Council’s September boom lights continued to show red lights. The continuous rise of leading indicators of prosperity and the slowing of the epidemic indicate that the domestic economy is growing. Taiwan stocks are currently in a sound physical condition and economic performance is strong. Therefore, there is no need to worry too much about the trading volume of Taiwan stocks next year. The Financial Management Committee will continue to pay attention to foreign investment trends and prices. situation.
