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Stockbrokers urge Putrajaya to suspend trading of Bursa Malaysia securities
savemalaysia
Publish date: Thu, 19 Mar 2020, 01:24 PM
KUALA LUMPUR (March 19): The Association of Stockbroking Companies of Malaysia (ASCM) has urged the government to immediately suspend the trading of Bursa Malaysia securities.
In a statement today, ASCM chairman Datuk Dr Azman Manaf said Bursa Malaysia should be suspended for the time being as a defensive measure to protect the stock market from suffering severe damage that could take almost a decade to heal.
Azman explained that the call to suspend trading activities at Bursa Malaysia was in line with the recent Movement Control Order declared by Prime Minister Tan Sri Muhyiddin Yassin.
He said the closing of FBM KLCI at 1,239.01 points on Wednesday showed that it had retraced by more than 28% from the end of December 2019, when it stood at 1,588.76 points, adding that market participants have already endured two major events recently, namely the change in government and the Covid-19 pandemic.
He added that stock exchanges around the world have plummeted, the worst being Wall Street.
“The Malaysian stock market has experienced a 23% drop in market capitalisation from RM1.04 trillion on Dec 31, 2019 to RM804.63 billion on March 18, 2020,” he said.
Azman highlighted that China suspended its Shanghai and Shenzhen Stock Exchanges amid the financial turmoil, and the Philippines also suspended its stock exchange on Tuesday (March 17), becoming the first country to suspend its stock market trade in response to the widening coronavirus pandemic.
He said the suspension order in Philippines was called after stock markets and oil prices went into freefall after its central banks' fresh stimulus measures failed to dampen investors’ fears.
Meanwhile, the Philippine Stock Exchange Index plunged 24% on Thursday on reopening after a two-day hiatus, while other Southeast Asian stock markets also sustained heavy losses on fears over the economic damage from the coronavirus pandemic.
The Philippine bourse opened 12.4% lower, triggering the first 10% circuit breaker following which a 15-minute trading halt was placed within minutes of the opening bell.
On resuming trade, the index fell 24.3%, marking its biggest intraday percentage fall on record and hitting its lowest level in nearly eight-and-a-half years.
“With the suspension of Bursa Malaysia, all participants of the stock market, i.e investors, market players, pension funds (EPF, LUTH, LTAT, PNB, etc), brokers, investment bankers, foreign investors and fund managers, will be able to utilise the time and relaxation to re-engineer their strategic and trading portfolios, as well as to avoid liquidation of accounts and force selling of leveraged accounts,” he said.
Azman cautioned that the negative impact will be catastrophic and possibly even drive the index below the 1,000 mark if no evasive action is put in place immediately.
“Such a catastrophe will definitely affect the national economy in the worst possible way.
“Banks will carry a huge amount of non-performing loans and public listed companies will see tremendous erosion of market capitalisation, while brokers will carry big contra losses and thousands of retail investors will experience bankruptcy,” he said.
At 12.19pm, the FBM KLCI fell 30.94 points to 1,208.07.
https://www.theedgemarkets.com/article/stockbrokers-urge-putrajaya-suspend-trading-bursa-malaysia%C2%A0securities
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Discussions
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Integrity. Intelligent. Industrious. 3iii (iiinvestsmart)$€£¥
Stock market should not be suspended.
Every investor should have access to their money.
Can cut down on the hours of trading though.
2020-03-19 13:55
Last chance to sell if true , but i think will not suspend.
Better to suspend all short selling .
2020-03-19 13:57
Margin account of listed companies CEO, Directors, major shareholders and retailers are forced sold by bank. So what is the solution?
2020-03-19 13:58
Even cash rich company like Gkent and Insas already drop so much that if use it own cash can buy out the company.
2020-03-19 14:01
U think suspend no,need to drop ka. C philiphines, suspend two,days. Wst hapen today? 12% drop. Same,same only
2020-03-19 14:02
"Posted by Sslee > Mar 19, 2020 1:58 PM | Report Abuse
Margin account of listed companies CEO, Directors, major shareholders and retailers are forced sold by bank. So what is the solution?"
It is a chance to spring clean the companies from being run by thieves and laidbacks. It is divine request. The people have been conned for a long time. This divine exercise is to install new breed of players.
2020-03-19 14:05
Got any case - suspension of stk mkt can prevent the collapse of stk mkt when open after suspension ?
2020-03-19 14:09
Gomen should set up fund to buy klCI component shares. If Bursa is suspended, a free fall would occur when the stock exchange reopens.
2020-03-19 14:12
Should reduce trading hours instead, everybody is stressed with the daily extra precaution to avoid catching the virus and have to endure the roller coaster market. Shorten hours and more time to destress. Half day trading will improve velocity.
2020-03-19 14:12
It happened in Hong Kong stock exchange when it suspended trading for week in 1998. When it reopens, everybody run for the exit.
2020-03-19 14:13
these ppl mkn gaji buta one. look at what they did. this morning mkt green ady, many starts rebound. then now drop 30 points, many tak jadi rebound and many panic sell. really tak layak jadi chairman. useless association chairman.
2020-03-19 14:24
Fear is only natural. But when there is a stampede for the door, the right course of action is to urge for calm and assure that the door will not be shut. Already, fear of trading suspension is exacerbating selling.
This is why The Edge disagrees with calls for the government to immediately suspend trading on Bursa Malaysia.
Yes, there will be selling — knee-jerk or otherwise — but the market also needs to be open for longer-term investors who have the staying power to buy and wait for the market uptick.
There are already circuit breakers to allow investors time to digest the situation. This mechanism can be enhanced, should the situation warrant it.
But the message that Bursa Malaysia remains open for business must ring loud and clear for all investors, who have the right to access their own assets, cash or shares.
Investors who are in the stock market should know that prices can go up and down. Those who cannot take the losses should not have been in there the first place. This may well be an expensive lesson, but all is not lost if one learns from the experience.
There is good reason none of the mature markets have shut their doors, despite even steeper losses, and Malaysia would do well to follow that example.
Shutting the door now will only see the rush for the door when it reopens – and by then, those rushing out will not just be the ones who want to leave now but also those who would have stayed.
The Philippines Stock Exchange (PSE) Index plunged 24% when trading resumed today after a two-day shutdown following steep losses. Obviously the shutdown did not achieve the intended calm.
2020-03-19 16:16
If bursa can reverse all the stocks price to 1 feb 2020 price level,then I agree..
2020-03-19 20:26
Today is only heating up the engine. If tonight Dow drop
again then tomoro will be full speed.Put on your safety
belt.
2020-03-19 21:33
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Sslee
your last chance to cut loss or buy cheap?
2020-03-19 13:32