Happy Chinese New Year every one. World market including Malaysia's stock market have been fallen since the first trading date of 2016. In Malaysia, most of the export company have been having correction during that period.
For some investor, they might be alot of reason for them to be invest now rather than stay in cash position.
I will listed down the reason why you should hold cash now.
Please keep in mind trade at your own risk. My article is to share to you all about my opinion why you should not invest in export shares now.
PUTRAJAYA: Households that use more than 300kwh per month will have to pay higher electricity tariff due to the reduction in rebates.
But those who consume less than 300kwh will not be affected.
Energy, Green Technology and Water Minister Datuk Seri Maximus Ongkili said there would be no change in the base electricity tariff from Jan 1 to June 30 next year.
However, the rebate has been reduced from 2.25 sen kwh to 1.52 sen kwh effective Jan 1 for those using more than 300kwh, which translates to RM77 per month.
The rebate reduction means that if you previously paid RM218.30 for 600kwh of usage per month, you now have to pay RM222.68.
ales at U.S. retailers declined in December to wrap the weakest year since 2009, raising concern about the momentum in consumer spending heading into 2016.
The 0.1 percent drop matched the median forecast of 84 economists surveyed by Bloomberg and followed a 0.4 percent gain in November, Commerce Department figures showed Friday in Washington. For all of 2015, purchases climbed 2.1 percent, the smallest advance of the current economic expansion.
The slowdown, including electronics stores, clothing merchants and grocers, indicates Americans probably preferred to sock away the savings from cheaper fuel instead of splurging during the holiday season. While hiring has been robust in recent months, faster wage gains remain elusive, one reason household spending may have a tougher time accelerating as the new year gets under way.
“There isn’t anything encouraging in this report,” said Thomas Simons, a money-market economist at Jefferies Group LLC in New York. “It’s very disappointing. The labor market is in good shape, which suggests the outlook is probably better than this.”
Estimates in the Bloomberg survey for retail sales ranged from a decline of 1 percent to a 0.3 percent advance. The November tally was revised up from a previously reported 0.2 percent increase.
Weak 2015
The increase for all of 2015 followed a 3.9 percent gain the prior year. It was the smallest advance since demand slumped 7.4 percent in 2009, when the recession ended in June of that year.
A separate report from the Labor Department showed inflation remained contained at the wholesale level. The producer price index decreased 0.2 percent in December from the prior month and was down 1 percent year-over-year.
The retail sales report showed six of 13 major categories showed declines in demand in December from the prior month, with a 1 percent slump at general merchandise stores that was the biggest since February, the report showed.
Receipts at gasoline stations dropped 1.1 percent. The Commerce Department’s retail sales data aren’t adjusted for prices, so lower fuel costs depress filling-station receipts.
Regular gasoline at the pump has dropped to a seven-year low, falling below $2 a gallon this week to reach $1.93 on Thursday, according to AAA, the biggest U.S. motoring group.
Clothing, Electronics
The retail report also showed sales decreased 0.9 percent at clothing chains and 0.2 percent at electronics stores.
Automobile dealers’ sales were little changed.
Industry figures earlier this month showed purchases of cars and light trucks came in at a 17.2 million annualized rate in December, the slowest since July, after an 18 million pace the prior month, according to Ward’s Automotive Group. Even so, industry sales data shows 2015 was a record year for automakers.
The figures used to calculate gross domestic product, which exclude categories such as food services, auto dealers, home-improvement stores and service stations, unexpectedly dropped 0.3 percent, the biggest decrease since February, after the prior month’s 0.5 percent increase in the so-called retail control group that was smaller than previously estimated.
Warm December
Warmer than usual weather last month probably curtailed purchases of winter gear including clothing. This was the warmest December on record for the contiguous U.S., according to the National Oceanic and Atmospheric Administration.
Some economists may lower estimates for fourth-quarter gross domestic product and consumer spending following the retail sales results. The median forecast in a Bloomberg survey shows household purchases rose at a 2.2 percent annualized rate from October through December, after a 3 percent pace in the prior three months.
Recent reports had signaled the November-December holiday season was a mixed one for retailers. Same-store sales fell in the two months for chains ranging from Macy’s Inc. to Best Buy Co. while those who snagged an increase included J.C. Penney Co. Same-store sales for the industry as a whole account for about 17 percent of total retail sales, which make up almost half of consumer spending.
Beige Book
“Growth of consumer spending ranged from slight to moderate in most Districts,” according to the Federal Reserve’s Beige Book economic survey based on reports from late November to early January by regional Fed banks. “Auto sales were somewhat mixed, as activity has begun to drop off from previously high levels in some Districts.”
Employers added 292,000 workers in December and payrolls for the previous two months were revised higher, the Labor Department reported last week. The jobless rate held at a more than seven-year low of 5 percent. Wages stagnated, with average hourly earnings unchanged from November and up 2.5 percent from a year earlier. They’ve been in the 2 percent range since the expansion began in 2009.
Following a stock market slowdown in August 2015 that saw the Shanghai Composite fall 8.5 percent – its worst single day in eight years – the Chinese economy continues to struggle amid continuing uncertainty, as labor unrest and lagging GDP growth spread throughout the vast country. As businesses, factories and financial services firms grapple with the economic reality in China, economists disagree on the nation’s fiscal outlook.
China has the world's second-largest economy behind the United States, and the rapidly developing nation has become an industrial giant over the past two decades. The economy slowed down throughout 2014 and 2015 and the stock market tumble in August 2015, dubbed China’s Black Monday, sent shockwaves throughout the world. Chinese economic growth has continued to shrink,hitting a 25-year low of 6.9 percent in January, the Wall Street Journal reported.
Despite persistent difficulties, an optimistic future awaits China, according to a report in the Financial Times Sunday. Fluctuations in the market have not greatly affected average Chinese households, the report argued. “Domestic wealth invested in stock markets is insignificant as a proportion of Chinese household wealth,” Chen Long of Gavekal Dragonomics, an investment research firm, told the FT.
Several top economists, however, predict a much bleaker outlook for China in 2016, according to analysis in the Wall Street Journal and Reuters. China’s growth will continue to shrink to 6.7 percentin 2016, according to a poll of economic forecasters, owing to a supply glut across sectors, Reuters reported. “We’re going to have a choppier sea ahead of us, ” Nomura Group economist Yang Zhao told the Wall Street Journal in January.
Shares rise, ringgit jumps to near 4-month high on dovish Fed comments, oil recovery
KUALA LUMPUR (NewsRise) -- Malaysian shares and the ringgit rebounded Thursday, in line with other Asian markets, as dovish comments from a Federal Reserve official saw the dollar slide overnight and sparked a big rally in oil prices.
The nation's benchmark FTSE Bursa Malaysia KLCI rose 1.44% to 1,656.77 points, trimming its weekly decline to 0.66%. For the year, the index is down a little over 2%.
SapuraKencana Petroleum, beaten down telecommunication stocks and Sime Darby led the gains on the benchmark index, while British American Tobacco Malaysia was the only stock to decline Thursday.
The ringgit rose 1.75% to 4.145, its highest level since October 15. It is the best performing Asian currency in 2016, advancing 3.4%.
New York Fed President William Dudley in an interview with MNI on Wednesday said financial conditions have tightened considerably since the authority raised rates in December and it would have to take that into consideration if they persist, highlighting concerns of weak economic outlook and a strengthening dollar.
The dollar index, which measures the performance of the dollar against a basket of currencies, rose 9% in 2015. It tumbled 1.6% Wednesday after the comments.
Brent crude oil prices rose 7% on Wednesday, supported by the slide in the dollar and rumors of potential output cuts.
"Dudley's comments are a strong signal that the Fed is rethinking the hike schedule and with further rate increase expectations pushed back, the upward pressure on USD/Asians eased overnight," said Jingyi Pan of financial advisory firm FORECAST. "Recovery in the ringgit was also helped by the higher crude oil prices, attributed to the sliding dollar."
Other regional currencies also rose, with the Indonesian rupiah and the Thai baht gaining 0.84% and 0.45%.
Southeast Asian stock indexes gained. Philippine's PSE Composite index and Indonesia's Jakarta Stock Exchange Composite index rose 2.01% and 1.52%. Singapore's Straits Times index and Thailand's SET index advanced 0.35% and 0.5%.
5) Foreign worker levy hike (have been delayed to be discuss after Chinese new year
Datuk Seri Ahmad Zahid Hamidi said the government's decision to restructure the levy rate system for foreign workers into two categories was expected to bring an extra income of RM2.5 billion to the country.
The deputy prime minister said today the new rate would come into effect beginning tomorrow, February 1.
Previously, he said the foreign workers were charged different rates were based on the sectors where they worked such as manufacturing, construction, service, plantation and agriculture.
"Now there are only two categories. The first is for those in the manufacturing, construction and service sector. Here each worker will be charged the new rate of RM2,500.
"For those in the plantation and agriculture, which come under the second category, the rate is RM1,500, per workers."
Zahid said domestic workers were exempted.
According to statistics, he said there were now some 2.135 million registered foreign workers in the country.
"Our Prime Minister Datuk Seri Najib Razak had in his 2016 national recalibrated budget speech touched on this restructuring.
"This is in accordance with the development in the country's economic scenario and that at international level."
He said the government needed to come up with the new rates as the foreign workers were also enjoying various benefits such as subsidised prices for food and other necessities, which were only meant for the country's citizens.
"They are enjoying our good infrastructures too but we are also acknowledging the vital roles they play in our nation-building and to our economy." – Bernama, January 31, 2016.
- See more at: http://www.themalaysianinsider.com/malaysia/article/rm2.5-billion-expected-from-new-foreign-workers-levy-rate-system-says-zahid#sthash.Zgm0cr2S.dpuf
6)Others
a) Oil price recover (might bring ringgit further increased)
b) Consumption in USA decrease, federal reserve might delayed the hike of interest rate. Hence US dollar might be further depreciated
c) Vietnam minimum wages increased by 12% (For the export company which have Vietnam branch)
d) Overvalue of certain export shares
e) Bad world market sentiment (especialliy USA and China) which will further affect the comsuption for rich people.
letitgo you are a joke. Type so much but make very little sense. Do you ever ponder how small the Malaysian market is with only <30mil population?
If companies only sell their goods in the local market, that is such a limiting factor in terms of demand. Companies that are able to export are able to compete on a global scale against producers from all around the world.
If a country only produces goods that are exclusively consumed by its own population, money is just being recycled. A few individuals may be getting wealthier but not the country as a whole as there would be no inflows of funds.
Anyway lets see how stupid your points are:
1) Which company is not affected by electricity tariff hike? 2) and 3) China and US are the biggest consumers in the world, even if they grow by 1%, due to the enormous base, the absolute amount is enough to absorb much of the world's production. 4) Looks like you have been sleeping all this while. The Ringgit has been very volatile and if you assume it will continue one a one way path in strengthening you are kidding yourself. Year-to-date gain of less than 3% is nothing in such volatile trading. In any case, 4.15 to 4.00 is still very attractive for exporters. 5) Again which sector is not affected by minimum wage increase? One that employs all local labour? How cost effective is that? 6) a) Would you dare to bet on an oil recovery? If so, you can buy Perisai or Hibiscus now. b) What if Bank Negara reduces interest rates in Malaysia to counter slowing GDP? Thought of that? c) Vietnam wage increase is long overdue and is still cheaper than China or Msian labour. d) There are ones that are extremely undervalued as well. e) The rich will spend in good times and bad.
FOCUS ON INVESTING IN COMPANIES THAT HAVE COMPETITIVE ADVANTAGE. ONES THAT ARE ABLE TO SOURCE RAW MATERIALS LOCALLY SUCH AS RUBBER AND TIMBER/PLYWOOD. THIS CANNOT BE REPLICATED ELSEWHERE.
wah.... u are anti uncle k. my opinion, export share already quite heat. shorten play ok, long term play sure die. must run faster than uncle k. play with high risk. dollar wont be strong longer. let see.
even export share recently got some drop but still in history high zone. dont forget, a lot of share already split many times. u think price now is the price last time? so short term play and full monitor on the dollar change is the must.
So simple, those think that usd will crash, please go to buy gold or bornoil. And for those who think that usd will rise, please also come to buy bornoil. Haha if u know what i mean
Oil is a consumable, and therefore not easy to "price in" just because the Iran sanction has been widely expected. It is not easy to "price in" because there is a limit how much crude oil can be stored. A better guide to real demand and supply balance is perhaps US crude oil stockpile data. What does it tell us? Stockpile has been increasing and there's may be a looming issue of storing all the excess, WITHOUT Iran dumping it's stockpile on the market. Go figure what happens when Iran's excesses hit the market. Let's put it another way. Your 70% drop in oil price happens while speculators are busy buying up crude to be sold at a later date due to contango pricing. These additional speculative demands are sitting on storage terminals and idle tankers, even BEFORE Iran unleashes it's stockpile.
Walao wei...if RM strengthen further with the crude price maintaining at this level...what will happen to Malaysian exports level??
KUALA LUMPUR (Feb 5): Malaysian exports rose 1.4% to RM68.3 billion in December from a year earlier driven by higher sales of electrical and electronic (E&E) products and timber and timber-based products to major buyers.
However, the annual export growth in December was slower compared with the median forecast of 5% growth polled by Reuters.
In a statement today, the Statistics Department said exports in oil and gas-related products, which included liquefied natural gas, crude petroleum and refined petroleum products, recorded a decline.
The exports of palm oil, palm-based products and natural rubber also fell.
According to Statistic Department, E&E accounted for 36.3% of total exports, while timber and timber-based products contributed 2.9% of total exports.
In geographical terms, the department said Malaysia had sold more goods to the US, Thailand, European Union and Indonesia.
Year-on-year (y-o-y) imports increased 3.2% to RM60.3 billion, mainly attributed to China (+RM940.5 million), Indonesia (+RM605.1 million), Thailand (+RM404.7 million) and Brazil (+RM360.6 million).
However, in seasonally adjusted terms, imports decreased 2.9% month-on-month to RM58.6 billion.
The Statistic Department said the total trade in December was valued at RM128.6 billion, representing an increase of RM2.8 billion or 2.2% from a year ago.
"It also posted an increase of RM3.6 billion or 2.9% when compared to the previous month," the department said.
On a y-o-y basis, a trade surplus of RM8 billion was recorded, a decline of RM916.2 million or 10.3%; it showed a decrease of RM2.2 billion or 22% compared with the immediate preceding month.
Reuters reported that December's exports are expected to slow slightly from the previous month's pace due to weak global demand and slumping oil prices.
The median forecast was for a 5% expansion in December from a year earlier, compared with a 6.3% rise in November.
Imports were forecast to grow 4.3% in December from a year earlier, slowing sharply from November's pace of 9.1%, the report added.
Double checked with www.tradingeconomics.com, The Jan 2016 US Consumer Index is at 11322.5 (highest todate). Why this article gave alarming US Consumer Index numbers ? Something is not wright here or my reference is wrong.
When the money collapse what will you keep? Of course it is gold! Zimbabwe had nothing else good to keep even if their Zimbabwe land used to be so fruitful like many strategically country
A mixed portfolio will streamline your 2016 stock performance. Malaysia knowing that, peoples can't afford any further slide to its currency. Pls exercise your adjustment after analyze the individual counter posted its 1st qtr results of 2016; May the Monkey be with us.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
shareinvestor88
Wait for the quarterly report and check the profit and cash holdings
2016-02-09 17:17