Malaysia - Market Strategy

[winston]

Bull run in sight

By GANESHWARAN KANA

RM1.8 trillion domestic economy.

In May, Bursa Malaysia hit another milestone after its market capitalisation crossed RM2 trillion for the first time.

Thailand is affected by its political volatility, while Indonesia is affected by foreign exchange risk that makes rupiah-based investments volatile.

For the week ended Aug 9, foreign investors net sold RM768.5mil worth of local equities.

Year-to-date till Aug 9, Bursa Malaysia recorded a net foreign fund outflow of RM165mil.

The ringgit appreciated by 3.1% against the US dollar year-to-date, reaching 4.45 per US dollar as at press time yesterday.

We maintain our end-2024 FBM KLCI target of 1,680 points, which implies a forward price-to-earnings multiple of 15 times.

Risks - sharper than expected US rate cut, US recession risk and the monetary tightening by the Bank of Japan (BoJ) to be faster than expected.

Source: The Star

https://www.thestar.com.my/business/bus ... unin-sight

[behappyalways]

Foreign net buying hits an 8-year weekly high.
Is Malaysia expected to break the September curse?

外资净买入创8年单周新高 大马有望破除9月魔咒？ | 八点最热报 05/09/2024

https://m.youtube.com/watch?v=o15XUuFUZ4s

[winston]

Top Performing Fund in Malaysia Switches to Consumer Stocks

Malaysia’s consumer stocks are set for a bounce thanks to tailwinds from a stronger ringgit.

Import of raw inputs become cheaper.

Reducing export oriented industry holdings because the ringgit has strengthened.

“We are moving back into more domestic-oriented sectors,” including banks and consumer stocks.

After falling to a 26-year low early this year, the Malaysian ringgit is outperforming its emerging market peers with a 14% increase in the three months through September.

The stronger currency, coupled with a rise in civil servants’ wages and higher disposable incomes, may spur consumer spending.

Source: Bloomberg

https://finance.yahoo.com/news/top-perf ... 00607.html

[winston]

Malaysia Strategy Budget 2025: Sticking to the game plan

Despite recent concerns of U-turns and backtracking of the Madani agenda, Budget 2025 demonstrates that this is not the case.

While key reforms and main fiscal drivers have not changed, we are particularly pleased by robust domestic demand growth expected into 2025.

Lacklustre share price performance since Jun, despite ringgit appreciation, provides an excellent buying opportunity. YE-KLCI target remains at 1,760.

Source: CIMB

https://rfs.cgsi.com/api/download?file= ... E13E5C15FE

[winston]

Maybank IB tells clients to go defensive, warns of potential economic risks brought by new US president

By Sankita Jayanandan

Potential economic turbulence and a surge in trade tensions, amid anticipation of more import tariff hikes if Donald Trump wins.

Potential “cushioning” from factors like tourism recovery, foreign direct investment and adjustments to supply chains across the region, the Asean-6 gross domestic product — expected to grow 4.8% in 2024 from 4.0% in 2023 — could be hampered if Trump wins.

Foresees rising headwinds in the region, particularly in trade and currency impacts with Trump’s possible return to office, coupled with proposals to extend tax cuts and raise tariffs on imports.

The current strong US economy-sticky inflation dynamics would be reinforced by his proposals to raise tariffs and extend tax cuts, meaning the US dollar could remain relatively strong and reduce the room for Asean central banks to ease and cut rates.

Threatened to raise import tariffs on China to 60% and impose a blanket 10% tariff on other nations.

Source: theedgemalaysia.com

https://theedgemalaysia.com/node/732741

[winston]

Win some, lose some with Trump

By JUNAID IBRAHIM and And TEH ATHIRA YUSOF

Malaysia stands to benefit from the possible “Trade War 2.0” between the United States and China following Trump’s re-election.

It predicted the export outlook would remain positive because the redirection of trade flows could encourage greater re-exports through Malaysia.

Source: The Star

https://www.thestar.com.my/news/nation/ ... e=smartech

[winston]

Banks, construction, utilities sectors to drive 2025 earnings growth — CIMB Securities

By Sankita Jayanandan

The earnings growth is driven by Madani government policies — the National Energy Transition Roadmap (NETR), Johor-Singapore Special Economic Zone (JS-SEZ), New Industrial Malaysia Plan 2030 — and strong foreign direct investments, including significant investments in data centres.

CIMB Securities' top five stock picks for the first quarter of 2025 are Hong Leong Bank BHd (KL:HLBANK), CelcomDigi Bhd (KL:CDB), Gamuda, Tenaga Nasional Bhd (KL:TENAGA) and Genting Malaysia.

Key events to watch in the second half of 2025 include the potential launch of the 13th Malaysia Plan in July, the Sabah state election before December 2025, and the Budget 2026 announcement in October 2025.

Source: theedgemalaysia.com

https://theedgemalaysia.com/node/738130

[behappyalways]

Builders, developers first beneficiaries of Johor-Singapore Special Economic Zone, analysts say
https://theedgemalaysia.com/node/740227

[winston]

STRATEGY – MALAYSIA Trading Opportunity Knocks

While we had anticipated Malaysian equities to swiftly correct after delivering some sparks at the start of the year, the FBMKLCI’s 5.3% ytd decline was markedly worse than expected.

Nevertheless, trading opportunities have emerged with the FBMKLCI now falling below our assessed trough valuation amid the broad-based selldown, and we expect to see a good rebound in last week’s sharply sold-down data centre plays.

Among the key rebound plays are Gamuda, Inari, IJM, ECW and Mah Sing.

Source: UOBKH

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[winston]

Alpha Picks: Spotlight On The Upcoming Results Winners

Our Alpha Picks modestly outperformed the FBMKLCI’s worse-than-expected plunge in Jan 25 (-4.0% vs -5.2%).

While we expect external headwinds to continue to soften, our Feb 25 picks continue to focus predominantly on winners in the upcoming results season, albeit with reduced indirect exposure to AI/DC plays.

2025 picks: Gamuda, GENM, Kossan, MrDIY, MYEG, Pekat, RHB Bank, RGB, VSI and Yinson.

Source: UOBKH

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