Taiwan Authorizes US$15 Billion Intervention To Stabilize Stock Market

Taiwan's government has authorized injecting US$15 billion into the country's stock market in a bid to arrest its ongoing slide.

Transcript

00:00Taiwan's stock market continues to spiral as investors respond to U.S. President Donald Trump's latest tariffs taking effect on Wednesday.

00:08But the government is stepping in to try to stabilize the market.

00:12Leslie Liao is at the stock market for us. Leslie, what is the government doing?

00:18Reese, the government has approved a 15 billion U.S. dollar package to intervene in the local stock market in a bid to reverse a downward trend.

00:29That money will be coming from the National Financial Stabilization Fund, which can be activated during times of turmoil.

00:36And this is the ninth time that the fund has been approved for use.

00:40If you look behind me, it's a sea of green, and that's not a good thing in Taiwan.

00:44Taiwan's stocks have not been having a good week at all.

00:48And this, what we're seeing, is a reaction to U.S. President Donald Trump levying a 32 percent tariff on Taiwanese goods.

00:55On Monday, when the market opened, it saw its biggest ever single-day drop, both points-wise and percentage-wise.

01:03Taiwan's weighted stock index, the Thai X, dropped 2,000 points and closed under 20,000.

01:09Taiwan's Financial Supervisory Commission anticipated the drop and placed limits on short-selling,

01:15which is an investment maneuver that allows people to profit off of stocks losing value.

01:20Stocks continued to slide on Tuesday, and they closed under 19,000.

01:24And then on Wednesday, they closed under 18,000 for the first time in 14 months.

01:30It's still unclear how this fund is going to be used, but essentially the money will be used to purchase local shares,

01:38to lessen market volatility and reassure investors.

01:41If precedent is anything to go by, Taiwan's major stocks like TSMC, MediaTek and Foxconn will receive some of that money.

01:50All three of those stocks have taken major hits since Monday.