Skip to main content

Asian Markets' Jitters

As reported in TheEdgeDaily - Asian stock markets fell and regional currencies weakened in the morning session today (Thursday) triggered by a series of negative news, including investment curbs in Thailand, Venezuela’s proposal to nationalise its utilities and the fall of oil prices to a 15-month low of US$55 (RM193) per barrel. Jakarta’s stock market was the worst hit, losing 3.96% or 70.51 points to 1,710.36 while the rupiah fell 0.55% to a two-week low on worries that Indonesia could also follow Thailand in imposing investment curbs. Japan’s Nikkei 225 fell 295.37 points to 16,942.4, Hong Kong’s Hang Seng Index was down 329.74 points to 19,568.34, Singapore’s Straits Times Index dropped 47.2 points to 2,961.15 and South Korea’s KOSPI lost 18.55 points to 1,355.79. However, the Stock Exchange of Thailand Index bucked the trend adding 0.71% or 4.39 points to 621.14, after falling 2.6% on Jan 9. On Bursa, the Kuala Lumpur Composite Index (KLCI) fell just 5.77 points or 0.52% to 1,113.19.

KLCI fell the least -... when did we become the strong man of Asia???

Analysts said the proposed nationalisation of Venezuela’s telephone and electric companies and Thailand’s move to cap foreign voting rights in Thai companies to 49% rattled investor confidence in emerging markets. The Caracas Stock market plunged 15% on Jan 9 after Venezuela President Hugo Chavez threatened to nationalise the country’s major utilities. I can understand the Thailand effect but Venezuela??? I guess one could argue that the Venezuela situation would be lumped as additional risk aligned with investing in emerging markets.

Oil price falling a negative??? That is news to me. It may temporarily halt the uptrend of CPO owing to the "viability" aspect of producing biodiesel vis-a-vis fuel price, but the benefits of lower oil prices are enormous - less inflationary pressures in the US, Europe and Japan - all having to contend with inflationary pressures, which now will subside. Of course, the US already showed some economic weakening in their domestic economy, and this will hurry the Fed to lower rates soon - good for equities.

There is a wild card though, the recent bombings in Thailand was compounded by 3 bomb explosions yesterday in the Philippines killing 7 and wounding 29 - obviously trying to disrupt this weekend's Asean summit there.

Our Thai friends are shaking their heads. Just back in December, they did a U-turn on a major policy, rocking its own stockmarket. Now, another policy reversal. Now they say that foreign ownership limitations of Thai companies won't affect the country's telecom sector - was this to appease the Singapore government - maybe the lion whispered to the elephant "Ehh, friend friend la... the leech is out of the forest already.. !!" These kind of nervous steps and missteps would shake the confidence of foreign investors even more, what will they do next, what won't they do, what is permanent or is everything fluid...

The risk climate of investing in stocks, particularly in Asia, has just been raised somewhat, better be sidelined, reduce.


swifz said…
There are no reasons but news writer always try to put one due to the believe of cause and effect.

Venezuela is the flip of the butterfly that causes a storm in Asia.

Popular posts from this blog

My Master, A National Treasure

REPOST:  Its been more than two years since I posted on my sifu. This is probably the most significant posting I had done thus far that does not involve business or politics. My circle of close friends and business colleagues have benefited significantly from his treatment.

My Master, Dr. Law Chin Han (from my iPhone)

Where shall I start? OK, just based on real life experiences of those who are close to me. The entire Tong family (Bukit Kiara Properties) absolutely swear that he is the master of masters when it comes to acupuncture (and dentistry as well). To me, you can probably find many great dentists, but to find a real Master in acupuncture, thats a whole different ballgame.

I am not big aficionado of Chinese medicine or acupuncture initially. I guess you have to go through the whole shebang to appreciate the real life changing effects from a master.

My business partner and very close friend went to him after 15 years of persistent gout problem, he will get his heavy attacks at least…

PUC - An Assessment

PUC has tried to reinvent itself following the untimely passing of its founder last year. His younger brother, who was highly successful in his own right, was running Pictureworks in a number of countries in Asia.

The Shares Price Rise & Possible Catalysts

Share price has broken its all time high comfortably. The rise has been steady and not at all volatile, accompanied by steady volume, which would indicate longer term investors and some funds already accumulating nd not selling back to the market.

Potential Catalyst #1

The just launched Presto app. Tried it and went to the briefing. Its a game changer for PUC for sure. They have already indicated that the e-wallet will be launched only in 1Q2018. Now what is Presto, why Presto. Its very much like Lazada or eBay or Alibaba. Lazada is a platform for retailers to sell, full stop. eBay is more for the personal one man operations. Alibaba is more for wholesalers and distributors.

Presto links retailers/f&b/services originators with en…

How Long Will The Bull Lasts For Malaysia

Are we in a bull run? Of course we are. Not to labour the point but I highlighted the start of the bull run back in January this year... and got a lot of naysayers but never mind:

p/s: needless to say, this is Jing Tian ... beautiful face and a certain kind of freshness in her looks and acting career thus far

I would like to extend my prediction that the bull run for Bursa stocks should continue to run well till the end of the year. What we are seeing for the past 3 weeks was a general lull where volume suddenly shrunk but the general trend is still intact. My reasons for saying so:

a) the overall equity markets globally will be supported by a benign recovery complemented by a timid approach to raising rates by most central banks

b) thanks to a drastic bear run for most commodities, and to a lesser extent some oil & gas players, the undertone for "cost of materials" have been weak and has pr…