KUALA LUMPUR: The local equity market is on a positive track, especially for the small and mid-cap stocks, despite the current sideways performance of the FTSE Bursa Malaysia KLCI (FBM KLCI).
Bursa Malaysia chief executive officer Datuk Muhamad Umar Swift (pix) said the short-term sell-off was due to various reasons, including global uncertainties created by the ongoing US-China trade war.
“However, if we look from the medium and long-term perspective, the market will rebound and return stronger,” he told Bernama in an interview.
On the domestic front, he said, the local equity market would remain favourable among the foreign investors as Malaysia had a fundamentally strong economy as well as a healthy gross domestic product forecast.
“This shows strong market demand and underlying economy,” he said.
As of this year, the small-cap stocks have moved up 12.95 per cent to end at 13,015.05 points yesterday while the mid-cap stocks have risen 17.24 per cent to 14,057.24 at the close.
He added that investment in equities depended on the risk appetite of the investors, who sought either safe returns or high-risk investments.
“Some would invest in real estate investment trusts for safe returns while some would go for derivatives for high risks,” he said.
There are more than 900 companies listed on Bursa Malaysia while foreign investment in the equity market stood at 22 per cent.
Meanwhile, asked about the possible listing of another Petronas subsidiary on the local bourse, Umar said such a move would provide support to boost local market demand as well as to gain strong traction among investors.
“We are excited for the opportunity. We are positive of the market outlook as our fundamentals are strong, backed by stable economic growth and future economic prospects,” he said.
Last Friday, Prime Minister Tun Dr Mahathir Mohamad said the government was mulling the possibility of listing one of Petronas’ subsidiaries, including Petronas Carigali, to make Bursa Malaysia more attractive. - BERNAMA