World’s youngest stock market struggles in Myanmar
The day’s trading is about to begin on the world’s youngest stock exchange, and the MYANPIX index and opening share prices flash across an electronic screen, but barely a footfall or a voice are heard within the cavernous, colonial era building in the bustling heart of Myanmar’s commercial capital. A gilded bell hangs silently above the almost empty floor, engraved with a single word: “Success.”
Not yet. Only three companies are listed on the board and at the end of the day just 7,221 shares were traded, compared with nearly 839 million the same day on the New York Stock Exchange. Since the YSE, a joint venture between Myanmar, Japan’s Daiwa Institute of Research and the Japan Exchange Group, began trading in March, only 20,000 investors have ventured into the market. Regulators complain that those who do take the plunge rely largely on rumors, herd psychology and even the stars.
Martin Zhang, an account executive with KBZ Stirling Coleman Securities, said one client offered him an astrological chart to help guide his investment decisions. The Amsterdam stock market, the world’s first, opened its doors 428 years ago. The New York Stock Exchange, the world’s largest, was born in 1817, Thet Htun Oo, senior manager of the Yangon exchange, reminded a recent group of visiting journalists.
“We are only a seven-month-old baby,” he said. A half-century of harsh military rule in this Southeast Asian country of 55 million brought economic ruin and isolation from the international community and global financial trends. But Myanmar remains a cornucopia of natural resources, and it is welcoming foreign investment as one of Asia’s last economic frontiers. The former British colony’s economic growth is forecast at 8 percent this year, among the fastest in the region.
Just a week after trading began on the Yangon exchange, a democratically elected government headed by former political prisoner Aung San Suu Kyi took power. Since then, the United States has lifted nearly all of the economic sanctions it had imposed on the former military regime, freeing up remittances from abroad which experts say may help fuel the market.
“We shall see. It’s conditional. If our economy prospers, the stock market will also do well,” said Khin Maung Nyo, an economist and author. For the time being, he advised caution for “Mr.
Average.” With the three listed companies mostly trading below their initial price levels, many investors have fared poorly. — AP
YANGON: In this Oct 25, 2016, photo, visitors view the new Yangon Stock Exchange board at the exchange headquarters in Yangon.