Malaysia is back on the radar screen of international investors with Singapore and Hong Kong showing greater interest in the local stock market, says Nomura Securities Malaysia Sdn Bhd.
In a research note today, it said there was an upside to the Malaysian economy and the market was riding on the recent spate of infrastructure-related projects, including oil and gas and property projects.
Nomura Securities Malaysia said investors were bullish on most sectors with the main focus on the oil and gas sector.
"Low foreign ownership, prudent monetary policy, improving fiscal balance due to strong commodity prices and the strengthening currency are positive factors that should raise the market higher," it said.
After a 32.8 per cent rise in 2010, the Malaysian stock market is up 4.2 per cent, year-to-date, in US dollar terms.
Despite the strong performance in 2010, Malaysia was still an under-owned market relative to other markets in Asean, Nomura Securities Malaysia said.
It also expected Malaysia's inflation to rise 3.3 per cent this year from 1.7 per cent in 2010, however, the strengthening ringgit was expected to help contain imported inflation.
Nomura Securities Malaysia expected the ringgit to strengthen 5.8 per cent this year.
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