Page 81 - SC Annual Report 2018 (ENG)

Securities
Commission
Malaysia
ANNUAL
REPORT
2018

OVERVIEW

Global growth softened in 2018, with uneven performances across major
economies. The year, which started on a positive footing, subsequently saw

materialisation of key downside risks to growth, particularly the increase in
trade tensions and tightening of global financial conditions. The global capital
market ended the year with markedly higher levels of global financial market
stress and volatility. Notwithstanding the challenging global environment, the

Malaysian capital market remained resilient compared to global and regional
market performance and continued to play a vital role in financing the
domestic economy.

The global economy is expected to grow at a GLOBAL DEVELOPMENTS IN 2018
more moderate pace in 2019, with synchronised
deceleration across all major economies including Global growth moderated in 2018, with most
the US and China. The global capital market will major markets witnessing uneven performances
continue to be shaped by uncertainties surrounding throughout the year. It started on a positive footing
key developments, including the pace of developed with the continuation of low level of financial
economies’ monetary policy normalisation, the markets volatility from the year before, underpinned
prospects of further increase in trade tensions and by higher global growth expectations after a
the risk of slower global growth. Against a backdrop synchronised acceleration in 2017. As the year
of a more challenging and uncertain global progressed, economic growth gradually became
environment, the Malaysian economy is expected weaker than initially expected amid materialisation
to remain on a steady growth path, underscored by of key downside risks to growth, particularly the
the continued resilience of domestic private sector continued increase in trade tensions and tightening
activities. Domestic capital market performance will of global financial conditions. The International
continue to be influenced by developments on the Monetary Fund (IMF) downgraded the global growth
external front and the general increase in volatility of forecast during the year (Chart 1).
global financial markets. Nevertheless, the domestic
market is expected to remain stable on the back of The US economy in 2018 was driven by robust
Malaysia’s strong macroeconomic fundamentals, consumer spending, underpinned by strong labour
deep domestic liquidity and well-developed capital market conditions, coupled with the continued
market infrastructure. rise in private capital expenditure due to sizeable

PART 4 »» CAPITAL MARKET REVIEW AND OUTLOOK | 71

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