Things Are-A-Changing At Bursa/SC
Finally, A Query That Brings Consequences
It used to be whenever KLSE or Sc queries a company's erratic share price movements, nothing would ever happen. The company will usually come back with the usual reply "not aware of any reasons why there is abnormal activity in their share price".. or something to that effect, and continue on its merry ways. After flogging Iris the horse till it caved, investors are now more sensitive to any queries or reprimands by the SC pr Bursa. Good thing!
Mobif Bhd, in reply to a Bursa Malaysia query yesterday, said it was not aware of any rumour or report on its business or affairs that could have contributed to the unusual market activity on its securities. In an update to its Aug 3 announcement, Mobif said subsidiary Mobif Wireless Broadband Sdn Bhd targeted to launch trial runs for its wireless broadband technology, iBurst Solution, in Kuala Lumpur next Tuesday. .... Ta-dah... Mobif share price fell nearly 30% this morning on huge volume and although regained some ground, still lost 20% in value.
Will this spell the end of speculation?
Answer: No. I don't believe the SC or the Bursa would want to kill it. What they do not want to see is excessive speculation or activity that mirrors cornering of a stock. Syndicates would just have to be more careful when doing financial engineering. Try not to go 5 days of straight gains, do the cha-cha .. three steps forward two small steps back ... and do not go more than 10% a day, it arouses suspicion already.
What are Bursa/SC motives and objectives?
Answer: Not to be regarded as a very cowboy market anymore. To kill off speculation especially pertaining to MESDAQ counters. If you are Second Board or Main Board, I think they will give you more leeway. If you are MESDAQ, I'd be very careful as Zarinah has the cane in her hand and she is willing to use it ... very swiftly. Which is also why the SC has been especially stringent in rejecting new IPO applications, in particular those for Mesdaq counters... heck, even Main Board and Second Board companies are finding it hard with issues such as usage of funds from rights issues - but the SC is right again here, the minority shareholders has to be protected and the integrity of corporate governance has to be maintained. Fining directors is another very good move, now old foggies cannot just show up and collect biscuit money.