Bursa Malaysia Outperforms Regional Peers Despite Mixed Global Signals

Bursa Malaysia outperforms regional markets despite global uncertainty, with potential opportunities in construction, property, and tech sectors, according to analysts.

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Bursa Malaysia Outperforms Regional Peers Despite Mixed Global Signals

Bursa Malaysia Outperforms Regional Peers Despite Mixed Global Signals

Bursa Malaysia managed to outperform other regional stock markets on Wednesday, despite mixed signals from global markets and concerns over rising geopolitical tensions. The benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) opened slightly higher, with gains seen in stocks like Axiata, MISC, Telekom Malaysia, and YTL Power.

The market's most active share was Ingenieur Gudang, while consumer stocks like Dutch Lady and Heineken Malaysia also saw increases. The gains came as US blue chips bounced back, slightly after a sharp decline, with the Federal Reserve signaling that interest rate cuts may be delayed.

Analysts expect bargain-hunting and better-than-expected China economic growth to alleviate the recent selling pressure, though they advise investors to remain defensive and focus on fundamentally sound stocks. Export-oriented and commodities-related stocks, particularly in the oil and gas sector, are expected to benefit from the continued strengthening of the US dollar and sustained high oil prices.

The FBM KLCI slipped 0.49% to 1,535.0, with 18 of the 30 component stocks ending lower. Market breadth was negative, with losers outnumbering gainers. Trading volume rose as profit-taking activities took control. The bearish market sentiment was not exclusive to Malaysia, as other regional markets also experienced significant declines, including Japan's Nikkei 225 index, China's Shanghai Composite Index, South Korea's Kospi, and Singapore's Straits Times Index.

Why this matters: The performance of Bursa Malaysia amid mixed global signals and geopolitical tensions highlights the resilience of the Malaysian stock market. The outperformance compared to regional peers showcases the potential for investors to find opportunities in specific sectors and stocks, even during uncertain times.

Malacca Securities Sdn Bhd expects a potential rebound in the construction, property, and technology sectors, and suggests that traders could stake their position within transportation and logistics companies, while long-term investors may look into more defensive sectors such as the consumer segment. The brokerage envisaged resistance around 1,550-1,555 and support at around 1,515-1,520.

Key Takeaways

  • Bursa Malaysia outperformed regional markets despite global uncertainties.
  • Gains seen in stocks like Axiata, MISC, Telekom Malaysia, and YTL Power.
  • Bargain-hunting and China growth expected to alleviate recent selling pressure.
  • Export-oriented and commodities-related stocks likely to benefit from strong USD and oil prices.
  • Malacca Securities sees potential rebound in construction, property, and tech sectors.