Investors Want Stability Post Ge15 Not Pre Election Goodies Says Midf Research
MIDF Research says external factors will continue to hold sway over equity market sentiment, rather than the general election.PETALING JAYA: Investors are more concerned about having stability after the 15th general election (GE15) compared to pre-election goodies and promises, according to MIDF Research.
The research arm of MIDF said the conventional expectation was that the market would get excited at the mere mention of a general election.
However, it described this as a “myth of the election rally”, adding that market performance before an election has been mixed since the 2000s, with price action coming in after the polls.
As such, it said, investors will be looking for political, societal and economic stability after the elections.
In a statement, MIDF Research also predicted voter turnout in GE15 to be similar to levels seen in past general elections, adding that this has been the trend since the mid-1990s.
“The voter turnout percentage in GE13 and GE14 were estimated to be 84.8% and 82.3%, respectively.
“However, if we were to transpose the current voter age and registration law onto the two previous general elections, we estimate that voter turnout will be lower, at 57.9% and 56.3%, respectively,” it said.
It also said there may not be a correlation between voter turnout and the eventual winners of the general election, as Pakatan Harapan (PH) won GE14 on a modified voter turnout of 56.3%, while Barisan Nasional won on a much higher turnout in 1995.
“Voter turnout may not be the best indicator of winners,” it said.
MIDF Research also expected bread-and-butter issues such as welfare, jobs and income will be more important to voters compared to voting along party lines.
It foresaw external factors to continue holding sway over equity market sentiment, as opposed to the general election.
These factors include the aggressive monetary tightening by major Western central banks, the Russia-Ukraine war and China’s economic conditions. - FMT
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