Review of Current Market

Hi All,

Here are some information on world market reviews:-

The DJIA closed +396.97 points after US government’s plan to bailout the Citigroup.The fluctuation of mkts have stabilized without the mad swings and crashes before this. US President has formed his economic team with NY Federal Reserve President Tim Geithner as Treasury Secretary to help US to recover in his 2 years stimulus package.

Europe markets closed within 5-10% positively.

Malaysian economy situation now compares to 1997/2001 is a lot better with 2.5% NPL and 75% loan ratio. Band Negara has lowered the overnight lending rate to 3.25% after 5 years. Well-timed as the economy slows down and in line with others. This will lower the cost of fund to the bank and cost of borrowing to the consumers. Certain sectors that export to US are affected like Seagate but Banks 3rd quarter reports still profitable.

In recent FMUTM annual Convention, it was pointed that Asia is not decoupled from US but actually we are more integrated than before. However, from 2004 to 2008 when US decelerated, Asia accelerated. With 3% US growth (optimistic) and Asia’s 7% growth (conservative), for every USD1 US is spending, Asia is spending 93cents. In 2010, Asia will catch up USD1 to USD1 (not in 15-20 years’ time as thought earlier). Conclusion is:- Same Train but Asia will be the Locomotive to drive the world growth in future.

What do you all think forward?


1. Invest in Unit Trust investment fund
2. For existing investors, you may choose either (1) investing a portion into existing funds and balance on monthly instruction (RII/DDI) or (2) one lump sum now.

For new investors, they are lucky to invest their funds in current market valuations which are below historical averages. Investment put in now will have higher growth than earlier investment. When markets recover, the existing investment will go back to around 8% pa CAGR and new ones may see 12-13% pa growth, say in 3-5 years time.