TAIPEI - TAIWAN said on Sunday it would end a temporary rule halving the daily limit by which individual stocks can fall, a measure put in place to stabilise the market due to large swings on other exchanges in the financial crisis.

The Financial Supervisory Commission (FSC), Taiwan's financial regulator, said in a statement the local stock market would resume the 7 per cent downward limit from Monday to boost the market's liquidity.

Taiwan stocks can normally rise or fall by a maximum 7 per cent on any given trading day, but the FSC cut the downward limit to 3.5 pe rcent starting Oct 13 and has kept the measure in place through Oct 24.

The regulator has come under growing pressure from traders to eliminate the temporary measure, which some see as preventing them from selling their holdings.

Despite sharp drops on global markets over the last two weeks, Taiwan stocks have posted relatively small losses due to imposition of the 3.5 per cent limit. Imposition of the low limit pushed trading volume to near an eight-year low, as many deals could not be completed because stocks were already trading down the allowed 3.5 per cent limit. -- THOMSON REUTERS