w w w . b u r s a m a l a y s i a . c o m

Issue 2 Vol 2 JUL 2010

Happenings and updates from Bursa Malaysia.

HIGHLIGHTS2 Market Highl ights

Malaysia Gems 2010

CFTC Allows Malaysian Futures Brokers to Deal Directly with US Customers for Bursa Malaysia Derivatives’ Products

Malaysia Recognised as an Approved Investment Destination by China

The Edge-Bursa Malaysia Kuala Lumpur Rat Race 2010

6 Is lamic Markets3rd Islamic Finance News Roadshow

Malaysia International Islamic FinancialCentre (MIFC) Roadshows To The Middle East

6th Annual World Islamic Funds & Capital Markets Conference

8 Market Educat ionEducation Programmes for Futures Broker’s Representatives (FBRs)

Note From The Editor

The Malaysian capital market, supported by strong economic fundamentals, has many attributes which can make it attractive for investors, both domestic and foreign. However, having been viewed as a “Tiger” economy throughout the 1990’s, enthusiasm from foreign investors to invest in Malaysia has not been restored since the General Elections of 2008 despite advancements made.

One of the key challenges facing the Malaysian market is the issue of perception over reality. Bursa Malaysia, together with key government stakeholders, has set out to address these lingering perceptions which, in many instances, have prevented investors from further exploring the Malaysian markets. You can fi nd the perceptions and the realities addressed in a publication called “Malaysia For Sustainable Investment” on our website.

With regard to the Exchange’s aim of encouraging more foreign participation, Bursa Malaysia showcased Malaysia’s offerings at a roadshow called Malaysia GEMS in Singapore. The event serves as a platform for Singaporean investors to meet on a face-to-face basis with Malaysian Public Listed Companies and discover investment opportunities in the Malaysian market.

In line with Bursa Malaysia’s aim of developing its niche in Islamic Capital Markets, the Islamic Markets team has been engaged in a number of roadshows to the Middle East to further strengthen ties, attract investors and issuers.

This is also the time of the year where we make fi nal preparations for our annual charity fundraising event, the The Edge-Bursa Malaysia Kuala Lumpur Rat Race, which will be held on the 3rd of August. With only a few weeks to the race, anticipation and excitement around this event has been building.

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4

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MARKET HIGHLIGHTSMARKET HIGHLIGHTS

Malaysia Gems 2010

The event served as an informative and interactive

platform for investors to study 11 Malaysian

Public Listed Companies (PLC) which could be undiscovered gems.

Malaysia Gems 2010, the cross-border Investor Relations roadshow organised by ShareInvestor and The Singapore Business Times, was run in partnership with Bursa Malaysia, Jupiter Online and CIMB-GK. The event took place on Saturday, 8 May 2010 in Singapore.

The objectives of the full day roadshow were to reach out to the Singaporean investment community and help Singaporean investors regain their confidence in Malaysia as an investment destination.

The event served as an informative and interactive platform for investors to study 11 Malaysian Public Listed Companies (PLC) which could be “undiscovered gems”. Investors were also given the opportunity to interact face-to-face with the PLCs through the booths set up at the foyer of the auditorium.

The featured PLCs were Green Packet Berhad, Hock Seng Lee Berhad, Kossan Rubber Industries Berhad, Kurnia Asia Berhad, Mudajaya Group Berhad, QL Resources Berhad, S P Setia Berhad, Sunway Holdings Berhad, Supermax Corporation Berhad, Unisem (M) Berhad, and Wah Seong Corporation Berhad. Jupiter Online and CIMB-GK were also present at the event to equip investors with the right tools for investing in Malaysia.

Despite the gloomy market sentiments and heavy showers, the event managed to draw a considerable crowd of 450 participants. The morning of the opening ceremony saw Guest-Of-Honour YBhg. Dato’ Md. Hussin Nayan, High Commissioner of Malaysia to Singapore, grace the floors of Malaysia Gems 2010. The Welcoming Address was given by Editor-in-Chief of the English and Malay Newspapers Division of Singapore Press Holdings (SPH), Mr. Patrick Daniel, followed by the Opening Address by Chief Executive Officer (CEO) of Bursa Malaysia, Dato’ Yusli Mohamed Yusoff.

11 Malaysian PLC were present during the Corporate Presentation sessions, and four special presentation sessions formed part of the event agenda. The panel discussion was well received by the investors, who asked questions that were on the minds of many investors for many years.

One of the corporate presentations which was well attended.

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MARKET HIGHLIGHTS

The United States Commodity Futures Trading Commission (US CFTC) has given its approval permitting member brokers of Bursa Malaysia Derivatives Berhad to solicit and accept orders and customer funds directly from US customers without the need to register separately as a futures broker in the US. This approval was issued in relation to Regulation 30.10 of the US Commodity Exchange Act. The approval was premised on the fact that member brokers of Bursa Malaysia Derivatives Berhad are subject to comparable customer protection standards in Malaysia.

Bursa Malaysia Derivatives Berhad Chief Executive Officer, Chong Kim Seng said, “Our brokers now have direct access to US customers to market our derivatives offerings, and it is a new added opportunity for our brokers to capitalise on this opportunity to increase their trading base.

“With the approval from US CFTC, and through the active solicitation of our brokers, we believe that Bursa Malaysia Derivatives’ futures products will gain wider market access and thereby, encourage more cross border trading. It will eventually create more vibrancy in the market and strengthen the profile of our derivatives offerings,” he added.

China has recognised Malaysia as an approved investment destination under China’s Qualified Domestic Institutional Investor (QDII) scheme administered by the China Banking Regulatory Commission (CBRC). The recognition marks a major step forward for the Malaysian capital market as it will facilitate the flow of Chinese funds into Malaysia and open up business opportunities for the Malaysian capital market intermediaries.

Securities Commission Malaysia (SC) Chairman Tan Sri Zarinah Anwar and CBRC Chairman Mr Liu Mingkang signed the Letters of Exchange in Beijing on 23 June to formalise the recognition. The China Securities Regulatory Commission (CSRC) has also confirmed that based on its existing Memorandum of Understanding (MOU) with the SC, Malaysia is also an approved investment destination under the QDII programme administered by the capital market regulator.

QDII is a scheme which enables Chinese nationals to invest in overseas markets through approved institutions. With the recognition, approved institutions regulated by CBRC and CSRC may now invest funds pooled from their clients into Malaysian securities, including equities, fixed income products and collective investment schemes approved by the SC.

The QDII recognition given by China is a significant development for the Malaysian market in paving the way for China funds seeking investment opportunities in this part of the region. Malaysia is only the second ASEAN country to be recognised as an authorised market.

Our brokers now have direct access to US customers to market our derivatives offerings, and it is a new added opportunity for our brokers to capitalise on this opportunity to increase their trading base.

MALAYSIA RECOGNISED AS AN APPROVED INVESTMENT DESTINATION BY CHINA

CFTC ALLOWS MALAYSIAN FUTURES BROKERS TO DEAL DIRECTLY WITH US CUSTOMERS FOR BURSA MALAYSIA DERIVATIVES’ PRODUCTS

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MARKET HIGHLIGHTSMARKET HIGHLIGHTS

THE EDGE – BURSA MALAYSIA KUALA LUMPUR RAT RACE 2010

The corporate charity race is back and this time, it will be held on Tuesday, 3 August 2010.

This annual event, which is into its 11th cycle, will see sporting corporate leaders and their high-spirited teams participate in a 4.5km run through Kuala Lumpur’s Golden Triangle, all in the name of charity. Runners clad in office attire or costumes reflecting their corporate identity will sweat it out amidst the roaring cheers of support from colleagues and the general public.

This year’s Race is expecting to see the same amount of support, more fun and excitement, all for a good cause. Participation fees collected will be channelled directly into Yayasan Bursa Malaysia and will be distributed equally to twenty selected charitable organisations. Tax exempt receipts will be given to all participating companies.

And yes, prizes await the fastest runners and the best dressed team!

So, if you and your company are keen to join in this fun Race, please contact Aidura Haron of Yayasan Bursa Malaysia at 03-20347000.

It is never too late to join us in making the 2010 Rat Race bigger and better. See you at the Rat Race!

Participants and cheerleaders enjoying themselves during last year’s Rat Race.

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MARKET HIGHLIGHTSMARKET HIGHLIGHTS

MALAYSIA FOR SUSTAINABLE INVESTMENTCorrecting Misconceptions and Updates on Capital Market Initiatives

In September 2009, Malaysia was placed on the FTSE Country Classification 12-month Watch List for possible promotion in the FTSE Global Equity Index Series to “Advanced Emerging” status. This was a key milestone for Bursa Malaysia and the Malaysian capital market. We hope to attain “Advanced Emerging” status by September 2010.

The e-brochure is now available on Bursa Malaysia’s website. To download the brochure with hyperlinks to the respective topics, please click below:

Malaysia For Sustainable Investment

Malaysia is currently classified as a “Secondary Emerging Market” by the FTSE Country Classification Committee. Since September 2009, Bursa Malaysia, together with other Malaysian delegations comprising Ministry of Finance, Bank Negara and the Securities Commission, continued their engagements with foreign investors and fund managers. The objectives remain to raise Malaysia’s profile, highlight its strong regulatory and market structures, as well as to allay any negative perceptions that may still persist regarding investing in Malaysia.

To facilitate the stakeholder engagements, Bursa Malaysia came out with a publication titled “Malaysia For Sustainable Investment” which aims to show the strengths and niche of the Malaysian Capital Market, initiatives taken to improve the market, and most importantly, to highlight the differences between the negative perceptions and the reality of investing in Malaysia today.

The messaging is supported by key government stakeholders, namely the Ministry of Finance Malaysia, Bank Negara Malaysia and the Securities Commission Malaysia. It contains important messaging for Malaysian delegations to improve investors’ perceptions about investing in the country. Important issues covered include the progress of liberalisation in Foreign Ownership policy since 1998, Malaysian Foreign Exchange Administration policy, enhancements in Regulated Short Selling (RSS) and Securities Borrowing and Lending (SBL). It also provides updates on Bursa Malaysia’s capital market initiatives.

We endeavour to highlight Malaysia’s continuous commitment to developing the capital market via initiatives that strengthen market competitiveness. These include capitalising on global opportunities in Islamic markets, the strategic partnership with CME Group and development of the Malaysian derivatives market, as well as the New Economic Model that is expected to transform Malaysia into a high income, inclusive and sustainable nation.

e-BROCHURE

BursaBytes 6

MARKET HIGHLIGHTSISLAMIC MARKETS

ISLAMIC FINANCE NEWS ROADSHOW

Bursa Malaysia participated in

Redmoney’s ASEAN leg of the 3rd annual

Islamic Finance News (IFN) Roadshow.

The IFN Roadshow is an educational

initiative aimed at developing Islamic

financial markets worldwide. Raja Teh Maimunah, Global Head of Islamic Markets, speaking at the IFN Roadshow in Singapore.

The MIFC Promotions Unit organised a roadshow to the United Arab Emirates (UAE) and Kingdom of Saudi Arabia (KSA) which ran from 25 April 2010 to 2 May 2010. In addition, a Roadshow showcasing Malaysia was held in Bahrain on 3 May 2010 in conjunction with the 7th Islamic Financial Services Board Summit on Global Financial Architecture: Challenges for Islamic Finance. The delegation was led by the The Raja Muda of Perak, YAM Raja Dr Nazrin Shah, who is also the financial ambassador of the MIFC initiative.

The key objectives of the MIFC roadshows were :

To provide a networking platform between MIFC community and stakeholders in UAE & Saudi Arabia•To explore potential investment opportunities in UAE & Saudi Arabia for Malaysia investors including identifying viable •projects to be funded via sukukTo follow-up on Prime Minister’s visit to Abu Dhabi and Saudi Arabia in January 2010; and•To promote MIFC value propositions •

The delegation was granted an audience with several members of the UAE and KSA Royal families and had a series of meetings with government and regulatory authorities. Bursa Malaysia was represented by Dato’ Yusli Mohamed Yusoff in UAE and KSA and Raja Teh Maimunah in KSA and Bahrain.

The ASEAN leg kicked off in Singapore on 13 April 2010, then went on to Jakarta on 15 April 2010 and finally to Hong Kong on 13 May 2010. Representatives from Bursa Malaysia were on hand to present a paper entitled “Regulating the Islamic Capital Market” for the roadshows.

MALAYSIA INTERNATIONAL ISLAMIC FINANCIAL CENTRE (MIFC) ROADSHOWS TO THE MIDDLE EAST

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MARKET HIGHLIGHTSISLAMIC MARKETS

Raja Teh presenting a paper on “Tapping into Strong Fundamentals

– Revitalizing Growth Prospects for Islamic Investment: Enhancing

the appeal of Islamic investment products through product diversity

and regulatory oversight.”

6TH ANNUAL WORLD ISLAMIC FUNDS & CAPITAL MARKETS CONFERENCE (WIFCMC 2010)

Bursa Malaysia participated as the event’s Gold Strategic Partner, held in the Kingdom of Bahrain from 24-25 May 2010. The event was attended by more than 400 leaders in the global Islamic investment industry which aimed to plot new growth horizons and forge winning business models in tune with the new economic realities faced by the Shari’ah compliant investment market. It was the most significant meeting in the six year of history of the WIFCMC.

Raja Teh Maimunah presented a paper on “Tapping into Strong Fundamentals – Revitalising Growth Prospects for Islamic Investment: Enhancing the appeal of Islamic investment products through product diversity and regulatory oversight” at the Conference. She highlighted the strong need for product diversity to address investors’ investment preferences, particularly in light of changes in investor behavioral patterns following the global credit crisis. This would be instrumental in creating a sustainable industry by displaying dynamism and responding to investor needs.

Industry players were

urged to consider the

change in investor

behavior patterns and

provide for greater

diversity in product lines

to cater for those seeking

safer and more defensive

investments such as

sukuk and Ijarah funds.

Delegates were informed that equities still dominated Islamic investment portfolios, whereas investors are seen to be shifting towards safer and more defensive investments such as cash and fixed income instruments. According to Capgemini’s & Merrill Lynch’s World Wealth Report 2009, in 2007, 40% of total investments were placed in cash and fixed income instruments. Following the global crisis, investors placed 50% of their investments in cash and fixed income instruments in 2008 and 2009. Industry players were urged to consider the change in investor behavior patterns and provide for greater diversity in product lines to cater for those seeking safer and more defensive investments such as sukuk and Ijarah funds.

Raja Teh called for the industry to strive for greater innovation and adoption of higher governance standards to enhance the appeal of Islamic investment products to ensure the sustainability of the industry and its expansion in the global markets.

BursaBytes 8

MARKET HIGHLIGHTSMARKET EDUCATION

EDUCATION PROGRAMMES FOR FUTURES BROKER’S REPRESENTATIVES (FBRs)

Continuing with the education

programme which was initiated

in October 2009, the Participants

Supervision Division (PSD) of

Bursa Malaysia held another two

education briefings for FBRs in

April 2010.

Both briefings were held outside Kuala Lumpur, with the objective of extending the programme coverage to other major towns with significant presence of representatives.

On 22 April 2010, the PSD representatives, along with their colleagues from Market Surveillance held the education briefings in Penang, as well as in Johor Bahru on the following day. The attendance at the briefings held in Penang and Johor Bahru was overwhelming, with 38 FBRs and another 36 FBRs participating in the programmes respectively.

PSD will continue the education programme as a platform to create awareness of regulatory issues to further improve the standard of compliance to the Rules as well as to instill a culture of self-regulation amongst the participants. The briefings also provided an opportunity for the participants to raise any other concerns relating to the industry.

PSD will continue to organise the education programme and looks forward to attracting more participants throughout 2010.

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MARKET HIGHLIGHTSSECURITIES

SECURITIES MARKET SNAPSHOT 2Q 2010Indices 2Q 2010 1Q 2010FTSE Bursa Malaysia KLCI 1,314.02 1,320.57FTSE Bursa Malaysia Top 100 8,643.78 8,698.70FTSE Bursa Malaysia EMAS 8,863.39 8,957.24FTSE Bursa Malaysia ACE 3,801.36 4,208.98FTSE Bursa Malaysia Palm Oil Plantation 11,469.67 11,988.76FTSE Bursa Malaysia Asian Palm Oil Plantation (USD) 16,562.89 18,003.79FTSE Bursa Malaysia Asian Palm Oil Plantation (MYR) 18,631.86 20,402.95FTSE Bursa Malaysia Hijrah Shariah 9,275.39 9,458.09FTSE Bursa Malaysia EMAS Shariah 8,764.17 8,925.85 Market Highlights Units 2Q 2010 1Q 2010Market Velocity % 28.4 34.8Market Capitalisation RM bil 1,044 1,061Total Trading Volume (OMT + DBT) bil 54 62Trading Volume (OMT) bil 50 58Average Trading Volume (OMT) bil 0.8 1.0Total Trading Value (OMT + DBT) RM bil 82 90Trading Value (OMT) RM bil 77 85Average Trading Value (OMT) RM bil 1.2 1.4No. of Trading Days day 64 59No. of PLCs counter 962 959No. of Listed REITs counter 12 12No. of Listed Structured Warrants counter 195 185New Listings - IPOs (Including REITS) counter 9 3New Listings - Structured Warrants counter 36 50No. of Delisted Companies (Including REITS) counter 6 4Total Funds Mobilised RM bil 2.8 10.2No. of Rights and Bonus Issues unit 14 22No. of New CDS Accounts Opened account 28,739 33,325

FOREIGN OWNERSHIP BASED ON MARKET VALUE

Jul-0

919

98

Jun-

10 2009

May-1

020

08

Apr-10 20

07

Mar-10 20

06

Feb-

10 2005

Jan-

10 2004

Dec-0

920

03

Nov-0

920

02

Oct-09 20

01

Aug-0

919

99

Sep-0

920

00

20.7

% 20.8

%

20.3

% 20.4

%

20.8

% 20.9

%

20.4

% 20.5

%

20.3

%

20.6

%

20.3

%

20.6

%

23.1

%

21.8

%

19.5

%

18.5

%

18.1

%

18.1

% 21.2

%

21.6

% 24.2

% 26.2

%

21.3

%

20.4

%

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MARKET HIGHLIGHTSSECURITIES

INFORMATION PACKAGE:-We also offer a wide range of products and services for our investing public. To learn more, kindly click on the following:

• Investor Information

• Historical Information

• Bursa Station

DAILY MARKET TREND: FBMKLCI AND MARKET VELOCITY

DAILY MARKET TREND: MARKET CAPITALISATION, TOTAL VOLUME AND VALUE

FBM

KLCI

Market Velocity

Mkt Capitalisation (RM

bil)Volu

me

(bil)

& V

alue

(RM

bil)

Mkt Capitalisation

Velocity FBMKLCI

Total Value Total Volume

Jul-0

9

Aug-0

9

Sep-0

9

Oct-09

Nov-0

9

Dec-0

9

Jan-

10

Feb-

10

Mar-10

Apr-10

May-1

0

Jun-

10

Jul-0

9

Aug-0

9

Sep-0

9

Oct-09

Nov-0

9

Dec-0

9

Jan-

10

Feb-

10

Mar-10

Apr-10

May-1

0

Jun-

100%

1,200

1,600

1,000

0

200

1,200

400

600

800

1,400

800

400

00

1

4

3

5

2

1,200

600

200

30%

60%

10%

40%

70%

20%

50%

80%

11 BursaBytes

MARKET HIGHLIGHTSSECURITIES

MARKET PERFORMANCE

Apr 16: Goldman Sach faced civil fraud charges and lawsuits

Apr 27 & 28: Greece, Portugal and Spain credit ratings downgraded by S&P

Apr 25: China tightened real-estate financing requirements

May 19: Germany unexpectedly banned naked short selling of shares

Jun 19: China pledged to promote further reform of its exchange rate mechanism

June 10: PM unveiled 10th Malaysia Plan

Jun 23: Malaysia approved as investment destination under China’s Qualified Domestic Institutional Investor (QDII) scheme

Jun 14: Moody’s cut Greece’s credit rating to junk status

May 13: - BNM raised its OPR by another 25 bps to 2.5%.

- Malaysia’s 1Q 2010 GDP grew 10.1% yoy

May 10: Announcement of a massive 750 billion eurozone stabilisation package from EU and IMF

Clueless about investing in the stock market? The answers to all your queries is just one click away, Investing in Bursa Malaysia.

Should you have any feedback or comments, kindly contact :

BursaBytes@bursamalaysia.com

INVESTING FOR BEGINNERS. LET US GUIDE YOU!

Total Volume Total Value FBMKLCI

01/0

4/20

10

15/0

4/20

10

29/0

4/20

10

13/0

5/20

10

27/0

5/20

10

01/0

4/20

1011

/06/

2010

25/0

6/20

10

10,000

9,000

6,000

7,000

3,000

4,000

1,000

2,000

5,000

8,000

Volume (units) / Value (RM

)(m

illion)

1000

1100

1200

1400

1500

1300

1050

1150

1250

1350

1450

Inde

x (p

oint

s)

BursaBytes 12

MARKET HIGHLIGHTSDERIVATIVES

DERIVATIVES MARKET SNAPSHOT 2Q 2010

Spot Month Gross Outright Margin Spot Month Back Month Margin Rate (RM) (RM) Spread (RM) Spread (RM)

FCPO New 28/6/2010 4,000 3,700 N/A 400

Previous 1/3/2010 5,000 4,500 N/A 500

Market Demography (FKLI) Category 1Q 2010 2Q 2010

Foreign Institutions 31% 26%

Domestic Institutions 2% 2%

Foreign Retail 0% 0%

Domestic Retail 45% 48%

Locals 22% 24%

Proprietary 0% 0%

TOTAL 100% 100%

Market Demography (FCPO) Category 1Q 2010 2Q 2010

Foreign Institutions 22% 22%

Domestic Institutions 15% 15%

Foreign Retail 0% 0%

Domestic Retail 26% 29%

Locals 37% 34%

Proprietary 0% 0%

TOTAL 100% 100%

Margin Rates

INFORMATION PACKAGE:-For more derivatives information, click on the following:

• Products • Market Demography

• Volume & Open Interest • Circulars

Open Interest

Volume

DISCLAIMER:Bursa Malaysia does not make any recommendation or endorsement regarding any securities or derivatives products identified in this newsletter. Please seek the advice of professionals, as appropriate, in respect of the evaluation of any specific securities or derivatives product, index, report, opinion, advice or other content.Whilst Bursa Malaysia endeavours to ensure that the contents in this newsletter are accurate, correct or have been obtained from sources believed by Bursa Malaysia to be accurate and reliable, please take notice that all information is provided on an “as is” basis without warranties of any kind and Bursa Malaysia hereby disclaims all expressed, implied and statutory warranties of any kind to the recipient of this newsletter and/or any third party. In no event shall Bursa Malaysia be liable for any claim, howsoever arising, out of or in relation to this newsletter to the recipient of this newsletter and/or to any other third party.

800,000

700,000

600,000

500,000

400,000

300,000

200,000

100,000

50,000

100,000

150,000

250,000

200,000

Exchange Total

Exchange Total

KLCI Futures

KLCI Futures

Crude Palm Oil Futures

Crude Palm Oil Futures

Jan-

07Ja

n-07

Jan-

08Ja

n-08

Jan-

07Ja

n-07

Jan-

10Ja

n-10

Apr-

07Ap

r-07

Apr-

08Ap

r-08

Apr-

09Ap

r-09

Apr-

10Ap

r-10

Jul-0

7Ju

l-07

Jul-0

8Ju

l-08

Jul-0

9Ju

l-09

Oct-

07Oc

t-07

Oct-

08Oc

t-08

Oct-

09Oc

t-09

0

0