S'pore-Malaysia trading link likely to be up only next year

THE trading link between the Singapore and Malaysia stock exchanges is likely to be established next year and not this year as planned.

But the bourses are looking at other ways to improve trading between the two markets, said Bursa Malaysia chief executive Yusli Mohamed Yusof yesterday.

He said at a press conference on Malaysia's economic outlook that 'the project is being held back as the Singapore and Malaysia exchanges are upgrading systems'.

Datuk Yusli said Bursa Malaysia expects to have its upgrading completed by the end of this year or early next year. So, the link 'won't happen this year. It will probably happen next year'.

The trading link has long been a discussion topic and he indicated last year that it could be up and running by this year.

The press conference, which comes ahead of next month's Invest Malaysia Conference, heard that the two exchanges are also discussing ways to make trading more efficient.

Bursa Malaysia is now looking to expand its product base by offering products in more than just the Malaysian ringgit and considering additional futures contracts.

Datuk Yusli said: 'We are improving our range of products, access to the market and introducing modernising technology.'

Mr Lim Chee Sing, who heads research at RHB Research Institute, which is a sponsor of the Invest Malaysia Conference along with Swiss bank UBS, said there was a 'confluence of positive factors' in Malaysia.

He cited an appreciating currency, growing demand in the property and construction sector, as well as a recovering agricultural industry with palm oil and rubber prices on the way up.

The recent earnings season saw good corporate results while pro-active policies from the Malaysian government are set to encourage more foreign investment. Government companies are also restructuring to become more efficient.

Stock market liquidity is strong, with the daily value of trades averaging almost RM3 billion (S$1.3 billion), nearly three times last year's average, according to Datuk Yusli.

The Invest Malaysia Conference will also discuss how Malaysia can be positioned better as an Islamic financial hub.