KUALA LUMPUR: Higher investor confidence coupled with the strong economy, raised Malaysia’s propensity in raising funds from local and foreign sources, leading to brisk growth in both the capital and bond markets.
Gross funds raised in the capital market increased sharply by 46.3 per cent to RM155.5 billion in the first seven months of this year, supported mainly by infrastructure financing needs.
This is in contrast to an increase of 31.8 per cent to RM106.3 billion in the same period of last year, the Finance Ministry said in its Economic Report 2012/2013.
The Treasury report also said gross funds raised by the public sector expanded 3.3 per cent to RM64.3 billion for the first seven months of 2012,compared to RM62.2 billion (47.6 per cent) for the same period of last year.
Gross funds raised by the private sector through private sector debt securities issuance rose significantly by 97.9 per cent to RM70.9 billion in the first seven months of 2012 compared to a 67.7 per cent increment to RM35.8 billion previously.
The positive trend was also reflected in the equity market, with the FTSE Bursa Malaysia Composite Index (FBM KLCI), having gained 100.87 points or 6.6 per cent from the beginning of the year to end-July.
In the face of external headwinds, the ministry noted positive factors on the domestic front, including the country’s strong economic fundamentals, coupled with the government’s ongoing transformation initiatives lending support to the market.
In addition, positive local corporate earnings results as well as the listing of Felda Global Ventures Holdings Bhd (FGVH) and IHH Healthcare Bhd, helped boost local market sentiment.
The FGVH listing was the second largest in the world after Facebook. IHH Healthcare was one of the largest listed private healthcare providers in the world based in terms of market capitalisation.
Mirroring the healthier growth in the domestic economy, the market continued its positive performance, as on Aug 15, the FBM KLCI registered a new high on 1,653.78 points.
It had been boosted by the stronger economic growth of 5.4 per cent in the second quarter of this year.
On the regional front, under the aegis of the Asean Capital Market Forum, the securities regulators and stock exchanges of Malaysia, Singapore and Thailand signed a Memorandum of Understanding on the Expedited Review Framework for Secondary Listing on March 16.
The objective of the framework is to speed up the processing of secondary listing applications, to foster greater capital market integration in the region, while promoting Asean as a global fund raising destination. — Bernama