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By On July 17, 2018

Malaysia's KWAP raising share of equities in asset mix

Kumpulan Wang Persaraan is a substantial shareholder in some of Malaysia’s largest listed companies. © Reuters

KUALA LUMPUR (Nikkei Markets) -- Malaysia's Kumpulan Wang Persaraan is raising the share of equities in its investment mix as the state-run fund bets on potential boost to domestic technology plays from the ongoing Sino-U.S. tariff tussle.

The money manager, commonly known as KWAP, which manages about $36 billion in assets of civil servan ts' retirement benefits, has expanded its equities mix in the total assets to 42.5% from 40% ahead of the May 9 national elections.

KWAP, which was "overweight on cash" prior to the general election is now drawing from the pile to buy shares that have turned attractive following a recent downturn in the broader market , Chief Executive Wan Kamaruzaman Wan Ahmad told reporters.

KWAP is a substantial shareholder in some of Malaysia's largest listed companies, including utility firm Tenaga Nasional as well as top two banks - Malayan Banking (Maybank) and CIMB Group Holdings. KWAP has also invested in semiconductor firm Pentamaster and U.S. ride-hailing firm Uber Technologies.

It allots most of its assets to fixed income instruments, followed by equities and the remainder to alternative assets such as private equity and real estate. Bulk of its investments are in Malaysia and international assets accounted for 13% of its portfolio.

Malaysia� 39;s stock market has turned jittery dragged by a sustained sell-off by foreigner funds, following a shock victory for the Mahathir Mohamad-led opposition Coalition of Hope that has hurled investors into uncertainty over policy direction.

Foreigners have sold 10.64 billion ringgit ($2.63 billion) worth of Malaysian shares since the May 9 polls until Monday, stock exchange data show. The sum exceeds the total 10.3 billion ringgit of foreign inflows through the whole of 2017. The selloff has erased Malaysia's benchmark KLCI's gains, dragging it down 3.3% year-to-date.

Since sweeping to power, Mahathir has scrapped the goods and services tax - a highly unpopular levy but a strong government revenue source - and reintroduced fuel subsidy to follow through his pre-poll pledges to ease the voters' cost of living.

Although the government expects such moves coupled with cost cuts will spur consumption, which in turn will boost domestic demand and economic gr owth, investors remain wary of the new administration's ability to meet this year's fiscal deficit target following its populist steps.

"We are always on our toes looking at how it can impact the (investee) companies," Chief Investment Officer Nik Amlizan Mohamad said.

However, the ongoing trade spat between the U.S. and China is likely to benefit Malaysian technology plays if the U.S. bars Chinese technology companies, Nik Amlizan said.

"Malaysia would be one of the beneficiaries of the trade war because the cost of certain products from China going into the U.S. would rise substantially," Nik Amlizan said. "The demand (for products) would find sources elsewhere...amongst which Malaysian electronic manufacturing companies would definitely benefit."

Electrical and electronics items make up more-than a third of Malaysia's merchandise exports.

"So we are actually positioning ourselves in those specific com panies," Nik Amlizan added.

The Bursa Malaysia Technology Index has risen 27% from a one-year low hit in early April, shortly after U.S. President Donald Trump first threatened to levy tariffs on Chinese imports.

Analysts expect KWAP's renewed thrust in Malaysian equities could help propel the benchmark KLCI higher.

"This could help drive up the index, as the state-run funds will definitely continue to invest in big-cap stocks...in banks, telco and plantation and select oil-and-gas stocks," said Vincent Lau, vice-president at broker Rakuten Trade.

There's potential for a spill over to small-and-mid caps as well, which will drive up more interest from retailers, he added.

--Alexander Winifred

See Also

  • Malaysia shares buck regional decline, Singapore also gains
  • Nikkei Asia300 slips after China GDP growth slows
  • Singapore shares sink on China's weak data
  • Nikkei Asia300 ends week higher despite Sino-US trade tensions
Source: Google News Malaysia | Netizen 24 Malaysia

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By On July 17, 2018

India Proposes Safeguard Duty on China, Malaysia Solar Cells

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Source: Google News Malaysia | Netizen 24 Malaysia

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By On July 17, 2018

Malaysia's King opens first session of Parliament since May 9 general election

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Login"; document.querySelector('body').innerHTML += noteHTML; document.querySelector('.timeoutmsg-area .close-button').addEventListener('click', function() { document.querySelector('.timeoutmsg-area').classList.add('hidden'); }); } } function timeoutNote() { var oneMin = 60000; var timeDur = 120; var timeoutDuration = timeDur * oneMin; setTimeout(timeoutEvt ,timeoutDuration); } Malaysia's King calls for unity as he opens Parliament session
The Malaysian King, Sultan Muhammad V, opened the first session of the 14th Parliament, marking a significant point in the country's history, on July 17, 2018.
Published8 hours agoUpdated41 min ago

KUALA LUMPUR - The Malaysian King, Sultan Muhammad V, on Tuesday (July 17) called for racial unity at the opening of the country's first Parliament session since Pakatan Harapan's (PH) stunning electoral victory on May 9.

"Negative elements and acts, that threatens integrity and harmony should be eradicated. Stop bringing up sensitive issues between races," said the King in a closely-watched speech which traditionally sets out the government's agenda.

Malaysia is now being led by the PH government which defeated Barisan Nasional (BN) on May 9, ending Umno-led BN’s grip on power since independence.

Breaking the tense mood in the chamber after Monday's dramatic walk out by BN and Parti Islam SeMalaysia lawmakers, the King kicked off his speech by joking: "You may all be seated and don't run away."

He called for order and unity in the country and among the lawmakers.

"The people have made their decision. Hence, all parties should accept with open hearts, not emotional, not clouded by slander and blind sentiments, narrow and closed," he added.

Urging politicians to be united, the King said he hopes all parties would find common goals and work together "for the people's well-being and the country's survival".

The King also said that that economic policies for the needy should not be racially targeted but rather turned into efforts to rid social injustices.

He praised the new government's efforts to boost transparency in governance by reviewing expenditures which exposed the country's true financial standing.

The King said he hopes the scrapping of the goods and services tax (GST), the stablising of oil prices and financial aid for needy groups would alleviate the people's burden.

The King's speech also outlined the possible legislations and motions the new administration may have to put forward.

He called for the drafting of strategies to deal with global economic fluctuations, the fourth industrial revolution and a half-time review of the 11th Malaysia Plan 2016-2020 that would be presented this year.

"The review is meant to evaluate all programmes and projects that have been passed, its (11th Malaysia Plan 2016-2020) direction and progress," the King said, before concluding that development has to be carried out nationwide, benefiting those in Sabah and Sarawak too.

A day after opposition lawmakers staged a walkout in Parliament, around 100 Umno members on Tuesday held a protest several hundred meters away from Parliament.

Rall y leader Lokman Adam urged supporters to rise against what he described as the new government's stifling of the King's voice - and Malay rights.

They were protesting against the appointment of several non-Malays as top-ranking officials in the Cabinet and judiciary. However police stopped them from marching towards Parliament.

The current parliamentary sitting will last 20 days and end on Aug 16.

The parliamentary schedule includes a debate on content of King's speech, followed by the tabling of Bills in the first week of August.

Tuesday's session marked the second time that the King has opened a parliamentary session in the same year.

On March 5, the King officially opened the first meeting of the sixth session of the 13th Parliament before the Dewan Rakyat was dissolved in April to pave the way for the 14th general election.

Topics:
  • MALAYSIA
  • POLITICS AND GOVERNMENT

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By On July 17, 2018

Malaysia PM Mahathir responds to people's rejection of new national car idea

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Login"; document.querySelector('body').innerHTML += noteHTML; document.querySelector('.timeoutmsg-area .close-button').addEventListener('click', function() { document.querySelector('.timeoutmsg-area').classList.add('hidden'); }); } } function timeoutNote() { var oneMin = 60000; var timeDur = 120; var timeoutDuration = timeDur * oneMin; setTimeout(timeoutEvt ,timeoutDuration); } Malaysia PM Mahathir responds to people's rejection of new national car idea
Malaysia's Prime Minister Mahathir Mohamad said Malaysians prefer buying imported cars, including those from Japan and Germany.
Published3 hours ago

PETALING JAYA (THE STAR/ASIA NEWS NETWORK) - Prime Minister Mahathir Mohamad voiced his disappointment over the mostly negative response towards the government's initiative for a new national car.

"I am told no one wants to see a second national car. It is enough that Proton is said to be a failure," Tun Dr Mahathir wrote in a blog post on Monday (July 16).

"Malaysians prefer to buy imported cars, including those from China," he wrote rather acerbically. "Their choice is Japanese cars and those with a lot of money (choose) German cars."

Dr Mahathir said countries such as Japan and South Korea discourage the import of foreign cars, and that is the reason behind their high-quality cars.

"I remember Japanese cars right after the war. The consumers said if we scratch it with our nail, we can see (it is made out of) Milo tin," he said.

"However from that 'Milo tin' car comes a variety of the Toyota, Nissan and Suzuki models that we use now."

Dr Mahathir said he is not suggesting that the new national car project be spearheaded by the government as the private sector is already capable of designing and mass producing cars.

"However, because we have rejected the suggestion of a (new) national car, we have already closed off all suggestions for the private sector to produce motor cars," he said.

He said foreign cars monopolised the car market in Malaysia to the point that Proton is "buried" and sold off to foreign entities.

"There is no more national car. No more automotive industry. The workers, engineers, managers don't have jobs anymore," Dr Mahathir said.

He did not refer to Perodua, the second national car company.

"Malaysia would become a country of consumers, paddy field planters and fishermen. Forget about Vision 2020," he said sardonically.

On June 11, Dr Mahathir revealed at the 24th Nikkei Conference on the Future of Asia the government's plans to work on a new national car.

However, many Malaysians did not respond positively to the suggestion. When the story was posted on the official Facebook page of The Star Online, there were more than 1,000 comments.

Many asked that the public transport system be improved instead, while some pointed out that the country had to learn the lessons of Proton.

Topics:
  • MALAYSIA
  • MAHATHIR MOHAMAD
  • AUTOMOBILE SECTOR

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