Malaysian-linked firms on SGX sees impact from GE14
KUCHI NG: Sha r e s in Malaysian-linked firms on the Singapore Stock Exchange felt the impact from the opposition’s shock win from the 14th General Election (GE14).
At closing, Singapore-listed stocks with exposure to Malaysia such as IHH Healthcare, Jardine Cycle & Carriage and Hatten Land fell.
Jardine C&C was down 97 cents or 2.86 per cent to SG$ 32.91, and Hatten Land down 0.1 cent or 0.62 per cent to SG$ 0.16. IHH Healthcare was initially down by seven cents to SG$ 1.96 during the day, but rebounded back to close at S$ 2.03.
Malaysia’ stock exchange was closed on Thursday and Friday.
Gan Eng Peng, Director of Equities Strategy and Advisory, Affin Hwang Asset Management said the win by the opposition signalled a new direction for Malaysia.
“A l l ma rke t s di s l i ke uncertainty, and we expect this could lead to bigger discounts with the adjusting factor being lower share prices overall.
“This would be the immediate reaction as the sell off will be broad-based,” he said in a statement.
“We are looking at five to eight per cent immediate downside within the next three days, where we note that preresults the market has already corrected by 3.5 per cent since it reached its record high in April.”
Contractors, pol it ical lyl inked counters and CIMB Group Holdings Bhd (CIMB) could take the brunt of the hit, he added.
Meanwhile, while the street is overwhelmingly bearish if the opposition wins, Gan held a bullish view.
“A ny new gove r nment will want to generate conf idence for the market and overal l populat ion. This fading of uncertainty should bring investors back to the market.
“Ultimately, we think markets will end up higher in less than a month than pre- election with this new government, barring unforeseen global macro overhang and a smooth transition of power is achieved.”