KUALA LUMPUR: Bursa Malaysia Bhd (1818)recorded a 44 per cent surge in net profit to RM40-5 million in the first quarter ended March 31 2011, from RM28-05 million on strong performance from its securities and derivatives trading- Total operating revenue rose 33 per cent to RM107-8 million compared with RM81-17 million previously- Chief executive officer Datuk Tajuddin Atan, in a press release yesterday, attributed the performance to the return of positive market sentiments and high liquidity- Strong expectations from various government transformation programmes (GTP) also contributed to an increase in trading activities in the securities market- He added that for derivatives, Bursa sees the increase largely due to both the cutover of derivatives trading on to the CME Globex(R) trading platform, as well as increased volatility of commodity prices- Bursa recorded a 46 per cent increase in trading revenue to RM57-7 million in first three months of 2011 while daily average trading value was higher at RM2-23 billion compared with RM1-53 billion last year- Daily average trading volume jumped 65 per cent to 1-73 billion- Market velocity, meanwhile, stood at 42 per cent- "We are targeting velocity of 50 per cent within two years, and if market conditions and sentiments remain as buoyant, I believe that we may reach this target even earlier," Tajuddin said- Trading revenue for the derivatives market increased 53 per cent to RM13 million with the Crude Palm Oil Futures recording a 62 per cent jump to 1-51 million contracts- The Kuala Lumpur Composite Index Futures contract was up 40 per cent to 610,000 contracts in the first quarter ended March 31 2011- Tajuddin said investors are now cautious following the recent calamities in Japan, Middle East and North Africa countries- However, he expects investors will take cognisance of the potential that the developments under the GTP will have on several key sectors such as construction, property, financial services, and healthcare, among others- He added that sustained domestic corporate earnings, prospects for mergers and acquisitions coupled by the strong fundamentals of the country are positive factors for investments going forward- "The recent announcement made by the Prime Minister during Invest Malaysia 2011 on the fast track scheme for dual licensing that will allow experienced securities remisiers to trade derivatives can have a positive impact on the derivatives market for more cross selling opportunities- The increase in proprietary day traders can also lead to greater market vibrancy and liquidity," he pointed out- "In June, Malaysia will be upgraded to an 'Advanced Emerging Market' by FTSE Global from its current 'Secondary Emerging Market'- We hope to see a rerating of portfolio by investors arising from this upgrade," he said- ...

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