TRADING volume on the local bourse continued to contract last week, for the third straight week. The daily on-market volume came up to little over 1.6 billion shares, on average, down from more than 2.2 billion in April, and is amongst the lowest, so far, this year.

Trading was fairly directionless. The FBM KLCI was range bound throughout the week, ending marginally higher at 1,812 last Friday. There were few fresh catalysts for local investors.

In fact, the market barely reacted to the release of 1Q15 GDP numbers — the economy grew 5.6% y-y, down slightly from 5.7% in the preceding quarter — which was broadly within expectations.

Even the debut of Malakoff — this year’s second and largest initial public offering, so far — failed to generate excitement. The independent power producer was the most actively traded stock on Friday. Its share price ranged as high as RM1.84 and as low as RM1.78 before closing at RM1.80, which is, incidentally, the IPO price.

By comparison, my basket of stocks held up quite well amid the listless broader market. Total value for my portfolio was up nearly 1.1%, outperforming the FBM KLCI, which was up by just 0.2%.

Looking at regional markets, trading sentiment was mixed to slightly positive. For the week, the benchmark indices in Thailand and Taiwan ended lower while that in Japan, Indonesia and China were up.

Trading in global markets was tentative and may have been affected by the sell-off in bonds and the resulting rise in yields. Whilst not triggering any panic, yet, Greece’s extended talks to negotiate an acceptable plan with fellow euro members and creditors continue to play at the back of investors’ minds.

Additionally, data out of the US is painting a recovery that appears to be losing some steam. Last week, retail sales data disappointed market watchers, pushing back expectations for the first rate hike since the Great Recession.

Reflecting this, the US dollar has been weakening against key currencies over the past few weeks. The ringgit ended higher at 3.56 against the greenback, from 3.60 in the preceding week. It closed at 2.69 and 4.05 against the Singapore dollar and euro, respectively.

Stocks in my portfolio closed mostly higher for the week. Oceancash, Lii Hen and Willowglen were among the top gainers while Thong Guan and Knusford ended in the red.

Last week’s gains lifted total returns for my portfolio to 11% since inception. I am outperforming the benchmark index, which was down by 1% over the same period, by some distance. I did not make any transaction last week.

This article first appeared in The Edge Malaysia Weekly, on May 18 - 24, 2015.

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