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Malaysia fund industry assets up 2% in June, 8% in first half on stocks, bonds

By Asia Asset Management  
Aug 16, 2019

Malaysia’s fund management industry's assets were up 2.03% in June and rose 8.03% through the first six months of 2019, driven by gains in stock and bond funds.

The industry had 803.26 billion ringgit (US$191.73 billion) of total assets under management as at June 30, up from 743.58 billion ringgit at the end of 2018, according to latest data posted on the website of Securities Commission Malaysia (SC). Assets increased 2.03% from 787.24 billion ringgit on May 31, 2019.

The SC typically posts the data without providing analysis.

According to a fund manager at a foreign insurance firm operating in Malaysia, the fund industry was largely buoyed by an improvement in the domestic stock market in June. But he is sceptical whether the industry can maintain the performance through the end of the year.

"With the ongoing US-China trade talks’ uncertainties and the slowing Chinese economy, it would need a big catalyst to push the Malaysian stock market upwards," the Kuala Lumpur-based fund manager tells Asia Asset Management, speaking on condition of anonymity.

Chinese Premier Li Keqiang said in May that China’s economic growth target for 2019 has been lowered to between 6% and 6.5% from "about 6.5%" previously because of several headwinds, including the trade war with the US.

Malaysia's benchmark FTSE Bursa Malaysia Kuala Lumpur Composite Index rose 1.29% in June but fell 1.09% in the first six months of the year.

The SC’s figures show that assets of stock funds jumped 11.28% to 390.90 billion ringgit in January through June and bond funds rose 8.77% to 172.84 billion ringgit. On a monthly basis, stock funds were up 4.02% from May while bond funds climbed 0.59%.

Assets of feeder funds, which invest in other investment funds, were up 2.27% to 30.59 billion ringgit in June from May, and rose 12.22% through the first half of 2019.

Assets of private equity and unlisted stocks rose 11.76% to 13.97 billion ringgit in June, and jumped 18.69% from January.