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A screen shows the graph of Malaysia's benchmark FTSE Bursa Malaysia KLCI Index in Kuala Lumpur May 6, 2013. Malaysian stocks surged nearly 8 percent to a record high and the local currency jumped to its strongest in 20 months on Monday after the Barisan National (BN) coalition extended its 56-year rule and fended off a strong opposition challenge that had unnerved investors.
A screen shows the graph of Malaysia's benchmark FTSE Bursa Malaysia KLCI Index in Kuala Lumpur May 6, 2013. Malaysian stocks surged nearly 8 percent to a record high and the local currency jumped to its strongest in 20 months on Monday after the Barisan National (BN) coalition extended its 56-year rule and fended off a strong opposition challenge that had unnerved investors.
(Bazuki Muhammad/Reuters)

FINANCIAL TIMES

Malaysia’s post-election rally masks unspectacular growth

Lex is a premium daily commentary service from the Financial Times. It helps readers make better investment decisions by highlighting key emerging risks and opportunities.

Phew. Now the politics are done, it is back to business. Monday’s post-election rally in Kuala Lumpur was a classic of the relief kind. Its stock market underperformance this year – flat – had been attributed to worries surrounding the vote. But just cheering a clear result misses the bigger point: Malaysia has been underperforming for longer than an election explains.