The Financial Supervisory Commission (FSC) says Taiwan’s stock market is expected to remain competitive even if the new Shanghai-Hong Kong Stock Connect program goes into effect.
The Shanghai-Hong Kong Stock Connect program will allow foreign investors to trade China’s A-shares in Hong Kong, and investors in Shanghai will be able to trade Hong Kong shares in China.
There have been fears that the new stock market link between the two cities will drive investors in Taiwan to move funds to Hong Kong to buy stocks listed in Shanghai.
However, the FSC said on Friday that the valuation of the Taiwanese equity market is still at a reasonable level. It said that it has faith that local shares with attractive valuations will remain on investors’ buying list despite the implementation of the Shanghai-Hong Kong Stock Connect. It also said listed companies in the Taiwanese stock market are more transparent in their finances.
The market previously anticipated that the Shanghai-Hong Kong Stock Connect program will take effect on Oct. 27. But the on-going pro-democracy “Occupy Central” movement in Hong Kong could delay the implementation of the stock market link.