Monday, November 05, 2018
Market Outlook as at November 5, 2018
Over the weekend, we have 2 pieces of good news; a sensible budget from our Finance Minister and a possible resetting of the trade war rhetoric between the US and China.
On the local front, I am encouraged by the following:
1. We are not strait-jacket by deficit reduction target; the Budget is relatively expansionary.
2. There are additional or new taxes but they are not broad-based (except for sugar-tax on beverages).
3. The proposed tax amnesty can be a good source of revenue.
4. There is effort made to address the need of house buyers - which may help to inject life into the property development and construction sectors.
This Budget, along with the final determination of legacy projects, should give clarity to the business & investing community to make their decision in 2019. Hopefully this will reinvigorate private investment - and boost our stock market. I am cautiously optimistic that FBMKLCI can go up to 1750.
Chart: FBMKLCI's daily chart as at Nov 5, 2018_9.30am (Source: Malaysiastock.biz)