A LOT more activities can be expected in the stock market next year as local and foreign investors' interest is being shifted from the bond into the equity market, according to Pheim Unit Trusts Bhd chief executive officer Phua Lee Kerk.
In his market outlook for 2004, Phua said foreign funds would be going more aggressively into the KLSE from next year as the Malaysian stock market had been lagging behind compared with other stock markets in the region.
He believed Malaysia would eventually catch up with Thailand and Singapore as the recovery in the US and Japanese economies would be a boon to the country.
The US economy has staged a strong rebound to grow at 8% in the last quarter.
This, coupled with strong consumer spending, would benefit us in terms of more exports from Malaysia going to the US, he said at his office in Kuala Lumpur.
On interest rates, Phua said it was not expected to go down but remain accommodative and stable at least for the next six months.
This positive market outlook is on condition that there are no major terrorist attacks or new diseases which are as damaging as Severe Acute Respiratory Syndrome or emergence of computer viruses next year, he added.
According to Phua, foreign fund managers are more likely to invest in individual companies with good financial performance. One such company is Duopharma Biotech Bhd.
After the Asian financial crisis, a lot of companies had gone under. Those that survived are really among the fittest and poised to gain more in terms of market share, in terms of stock market valuation, he said.
On the company's Pheim Income Fund, Phua said it had declared a higher net distribution of 6.50 sen per unit from 4.50 sen last year.
Other funds that had also recorded higher distribution were the Pheim Emerging Companies Balanced Fund (5.50 sen per unit from 4 sen) and the Dana Makmur Pheim (5.50 sen per unit from 2.50 sen).
Their advantage is that they invest actively in the Asia-Pacific markets including Singapore, Thailand, the Philippines, Indonesia, China, Hong Kong, Taiwan and South Korea, he added.
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