BULL RUN ???

Referring to TheStar Business today at

http://biz.thestar.com.my/news/story.asp?file=/2006/11/13/business/15998391&sec=

 

In a report titled Secular Bull Case For Emerging Market Stocks last week, Merrill Lynch said the Malaysian market rose 92% between Oct 10, 2002 and Oct 27, 2006, as measured on the Morgan Stanley Capital International or MSCI index. That was a gradual rise over four years until it accelerated this month.  

During that four-year period, Malaysia was the worst of 19 emerging markets tracked by Merrill Lynch. Oil-rich Russia topped the list with a surge of 848%, Brazil second with 747% and Czech Republic third with 655%.  

Among the large high-growth economies, India was fifth with a gain of 569% and China sixth with 542%.  

In the Asean region, Indonesia was fourth on the 19-market list, ahead of even India and China, gaining 572%, and Thailand was 12th, rising 347%.  

It must be a relief that Malaysia is at least participating in this long rally.  

Merrill Lynch made a case that there are still legs in this emerging markets bull run. The basis for this is its view of the still emerging, and in some aspects, superior, quality of these economies. Emerging countries, for instance, hold 70% of the world's foreign exchange reserves, and are less prone to contagious crisis than in 1997/98.

There is value in many of the stocks on Bursa Malaysia. Investors here should have more than a glimpse of the rally, as long as the bull run continues in the leading emerging markets.