Malaysian Market Uncertain Amid Political Turmoil

Malaysia's Pearl of the Orient, Penang which is a major tourist destination has been in the limelight recently, for the wrong reasons. A Penang leader in UMNO (The main party component in the Barisan Nasional front which currently governs the country) was alleged to have uttered racists remarks that caused an uproar among the members parties of the coalition who demanded the PM to take action against him immediately for refusing to withdraw and apologize for the statement he made during the Permatang Pauh by-election which was eventually won by opposition leader Anwar Ibrahim.

Now former Prime Minister Tun Mahathir has re-joined UMNO after resigning the party 3 months ago because of concerns with the current situation. Other pundits say he may work with his former nemesis Tengku Razaleigh Hamzah and Muhyiddin Yassin to rin for top posts in UMNO.

Regional markets rally on Monday except for the benchmark Kuala Lumpur Composite Index. In fact the market literally came to a standstill while other markets rallied 4 to 5%. On Tuesday, the KLCI closed lower, following a correction in the regional markets. Regional markets are expected to decline further today as the Dow Jones Industrial Index declined 280 points yesterday, wiping out Monday's gains.

Malaysian market is expected to remain firm with a downward bias as investors are staying in the sidelines to wait one of the most important event that is going or not going to happen that will affect the whole nation, that is can former DPM Anwar Ibrahim form a new government which he is so confident till today amid allegation of sodomy. He will be brought to court today to hear the charges.