Midas Holdings (5EN.SG) is down 4.1% at $0.830, falling sharply in heavy volume for a second straight session after Chinese media reported over the weekend that authorities have dismissed the country’s railways minister amid an investigation for “serious infractions.” 

The minister, Liu Zhijun, was in charge of overseeing China’s ambitious layout of a high-speed rail network. “The selling is based on the incident (with the minister) as there’s some risk to Midas due to there being some uncertainty and risk to the sector, but it doesn’t relate to directly to Midas. The company is not implicated in any corruption because they don’t deal directly with the Ministry of Railways...it’s more of an overall sector risk,” says James Koh, an analyst at Kim Eng. 

 

He adds, it’s hard to say if the selling is overdone at this stage " we’ll have to wait for more clarity on the possible changes in policy, but certainly because of the sector uncertainty, that’s the reason the share price is tumbling.” 

 

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