THE local infantry of online armies surely did not mince their words when they swore that they would raid stocks of glove makers, principally that of Top Glove Corp Bhd today.
And they did so in full force, oblivious to the weak market sentiment which saw the FBM KLCI edging down 14.22 points or 0.90% to 1,566.40.
The world’s largest glove maker saw its stocks soared 53 sen or 8.53% at the close of today’s trading to RM6.74 with a hefty 161.62 million shares exchanging hands, thus valuing the company at RM55.28 bil.
The counter which ended as the day’s fourth most active stock – and the third biggest gainer – had even momentarily touched RM7.12 at the commencement of trading before price started to consolidate.
As expected, fellow Big Four glove stocks also enjoyed the spoils with Hartalega Holdings Bhd ranked second in the gainer’s list by chalking up 66 sen or 5.41% to RM12.86 with 14.66 million shares traded.
Supermax Corp Bhd rose 24 sen or 3.66% to RM6.80 with a volume of 45.23 million shares while Kossan Rubber Industries Bhd was 19 sen or 4.46% higher at RM4.45 with 14.42 million shares traded.
The million dollar question for now is if today’s victory would be a one-off affair or would the loyal investors return even stronger on Monday to reinstate their claims that glove counters have been grossly marginalised by institutional investors who short their stocks.
Whatever the choice is, the Securities Commission (SC) and Bursa Malaysia Bhd are closely monitoring the local stock market in light of the current price surge of selected stocks in the US markets, fuelled by social media chatrooms against short-sellers.
“Malaysian investors are advised to be cautious of social media chatrooms that try to influence investors to buy or sell certain stocks based on speculation or rumours,” the market regulators pointed out in a joint media statement.
“Investors should also be wary of discussions in these social media chatrooms that may trigger securities breaches such as the provision of investment advice or stock recommendations without a licence.”
Any person found guilty may be liable to a fine not exceeding RM10 mil or imprisonment not exceeding 10 years or both, the market regulators warned.
“The market dynamics between the US and Malaysia differ. In Malaysia, regulated short selling (RSS) is only applicable to approved securities in the RSS list which currently comprises 218 securities,” noted the SC and Bursa Malaysia. “Limits are also imposed to prevent excessive short-selling activities.”
In addition, the market regulators further clarified that RSS trades require investors to either borrow the approved securities to be short-sold or have confirmation of borrowing of the approved securities. RSS must be undertaken in a designated account where sell orders must be placed at the best offer price or higher.
“The SC and Bursa Malaysia conduct real-time monitoring of all trading activities to detect, analyse and escalate trading concerns promptly,” the market regulators pointed out.
“Robust frameworks are in place to ensure an efficient, fair and orderly market. Where warranted, the SC and Bursa Malaysia will take the necessary measures to curb disruptive trading practices and market abuse.”
Earlier, the Minority Shareholders Watch Group (MSWG) has cautioned minority shareholders to exercise diligence by being aware of the risks involved in such initiatives.
“Generally, institutional investors tend to have deeper pockets,” warned its CEO Devanesan Evanson.
“This is not to under-estimate the retailers’ purchasing power. At the end of the day, it may become an issue of who has deeper pockets and the stamina to sustain their initiatives.”
Secondly, there may be some unscrupulous retailers including “stock market gurus” who may unload their shares after having encouraged other retailers to drive up the share prices, he added. – Jan 29, 2021
