Business

Bursa to trade on cautious note amid bearish market outlook

Meanwhile, ringgit set to see higher trading next week

Updated 4 years ago · Published on 15 Jan 2022 11:30AM

Bursa to trade on cautious note amid bearish market outlook
Rakuten Trade Sdn Bhd vice-president of equity research Thong Pak Leng says investor sentiment is expected to remain soft in the short term weighed by external factors such as increasing market risks and volatility in global markets amid the potential interest hike by the US Federal Reserve. – Bursa Malaysia Twitter pic, January 15, 2022

KUALA LUMPUR – Bursa Malaysia is expected to continue to trade on a cautious tone next week due to bearish market outlook mainly from the external front, but the key index will likely stay above the psychological 1,500 level, dealers said.

Rakuten Trade Sdn Bhd vice-president of equity research Thong Pak Leng said investor sentiment is expected to remain soft in the short term weighed by external factors such as increasing market risks and volatility in global markets amid the potential interest hike by the US Federal Reserve (Fed).

“Nonetheless, we expect bargain-hunting to set in as the fundamentals of Malaysian companies are improving.

“Furthermore, we believe local equities are undervalued as compared to its regional peers, therefore offer good potential upside for investors. As such, we expect the FBM KLCI (FTSE Bursa Malaysia KLCI) to move within the 1,550-1,570 range next week,” he said.

Yesterday, Thong said the FBM KLCI closed lower due to selling pressure across the region, losing 0.9% or 14.18 points to end at 1,555.33.

“Key regional markets were lower following the broadly negative cues overnight from Wall Street, with energy and technology stocks primarily dragging markets down.

“Additionally, hawkish remarks from Fed officials made clear that US interest rates could rise as soon as March, putting an end to ultra-easy monetary conditions,” he added.

On a Friday-to-Friday basis, the FBM KLCI rose 12.22 points to end the week at 1,555.33 from 1,543.11 last week.

The ringgit is likely to trend higher next week in the range of RM4.16 to RM4.17, with the market adopting a cautious stance prior to Bank Negara Malaysia’s (BNM) economic assessment next Thursday.

Bank Islam Bhd chief economist Mohd Afzanizam Abdul Rashid said all eyes would be on BNM’s  Monetary Policy Committee meeting on January 20.

“Investors might want to digest the latest economic assessment by BNM via the Monetary Policy Statement, which will be released on the same day. I suppose there will be more guidance on how the monetary policy will be administered this year,” he said.

He also added that the support level for the ringgit against the US dollar stood at RM4.1498.

The ringgit trended higher throughout the trading week just ended except for yesterday. – Bernama, January 15, 2022 

Related News

Business / 5mth

Ringgit edges higher against US Dollar amid subdued market sentiment

Business / 6mth

Ringgit retreats to 4.00 versus the US Dollar amid West Asia ceasefire uncertainties

Business / 7mth

BNM ensures orderly financial markets amid global uncertainties

Malaysia / 7mth

Middle East conflict: Brace for more expensive imports - Tengku Zafrul

Malaysia / 7mth

Two factors contributed to lower EPF dividends this year – CEO

Places / 10mth

Planning a year-end break? The Land of the Rising Sun beckons

Spotlight

Malaysia

Man kidnapped, tortured, and killed following misunderstanding

Malaysia

'I will never forget taxi drivers who backed me in my hardest times' - PM Anwar

Malaysia

Najib fails to secure stay of 15-year jail term, RM11.38b fine in 1MDB case

Malaysia

Ivana Smit’s mother considers Federal Court appeal after RM1.1m award overturned

Education

Schools in Negeri Sembilan, Melaka to reopen tomorrow as haze conditions improve

Malaysia

Zara Qairina inquest: Investigating officer says final findings showed no suspicious circumstances

Malaysia

Man jailed 8½ years for abusing three-year-old boy, forcing the child to eat faeces

World

Pope Leo XIV diagnosed with lung cancer after successful surgery

Malaysia

More than 3,000 Myanmar refugees set for repatriation after Malaysia secures breakthrough

You may be interested

Business

Oil prices rise as Gulf attacks threaten supply recovery

Business

Oil price surge threatens to raise Malaysia’s cost pressures as ringgit steadies

Business

SC targets stronger board oversight through higher standards for company secretaries

Business

SC expands new co-investment fund in 2027 to unlock growth capital for Malaysian businesses