Malaysian Stock Exchange Could Prolong Losses From Yesterday
The Malaysian stock market is expected to open on a positive or neutral note on Friday, according to market analysts. This optimistic outlook is driven by several key factors, including the recovery of global equities, robust US markets, and the upcoming release of Malaysia's Q2 GDP and current account data.
Global equities, particularly in emerging markets such as Asia, are performing strongly. This growth is attributed to positive stimulus hopes in China and the weakening of the US dollar. US markets, meanwhile, remain robust, with the S&P 500 hitting new highs due to strong corporate earnings in tech and optimism in trade policies.
Malaysia's Q2 GDP and current account data, while not yet released, are expected to play a significant role in boosting investor confidence. If the GDP growth remains steady or improves and the current account remains in surplus or stable, this would support the local market.
The current mid-cycle pause in the US business cycle, coupled with modest global growth and easing inflation, suggests that recession fears are low, which tends to encourage risk appetite in emerging markets like Malaysia.
However, it's important to note that short-term volatility may occur due to global bond yields or geopolitical news, as always. On Thursday, the Kuala Lumpur Composite Index (KLCI) halted its seven-day winning streak. Major companies such as IHH Healthcare, Kuala Lumpur Kepong, Maxis, Maybank, MISC, MRDIY, Petronas Chemicals, Petronas Dagangan, Petronas Gas, PPB Group, Press Metal, Public Bank, QL Resources, RHB Bank, Sime Darby, SD Guthrie, Telekom Malaysia, Tenaga Nasional, YTL Power, and 99 Speed Mart Retail remained unchanged. Axiata declined by 1.11 percent, while Petronas Gas surrendered 1.16 percent and Petronas Dagangan plunged 3.57 percent.
The KLCI finished modestly lower on Thursday due to losses from the plantations and telecoms. Crude oil prices, however, jumped ahead of a meeting between the US and Russian presidents in Alaska. The current account showed a surplus of MYR16.70 billion in the previous quarter, and the producer price inflation data partly offset optimism about a September interest rate cut.
Friday's market movement will be heavily influenced by the release of Malaysia's Q2 GDP and current account data, as well as global market trends. Investors are advised to stay informed and cautious, as short-term volatility remains a possibility.
[1] Global equities recovering strongly: [Source] [2] Emerging markets outperforming developed markets: [Source] [3] US markets robust with S&P 500 hitting new highs: [Source] [4] Positive stimulus hopes in China: [Source] [5] Weakening of the US dollar: [Source] [6] US markets concentrated in a few large-cap stocks: [Source] [7] Malaysia’s Q2 GDP and current account data: [Source] [8] Mid-cycle pause in the US business cycle: [Source] [9] Global growth and easing inflation: [Source] [10] Recession fears are low: [Source] [11] Q2 data for GDP and current account to be released later today: [Source] [12] Global forecast for Asian markets: [Source] [13] Meeting between the U.S. and Russian presidents: [Source] [14] West Texas Intermediate crude oil prices: [Source] [15] The Kuala Lumpur Composite Index: [Source] [16] Movements of specific companies in the KLCI: [Source] [17] Producer price inflation data: [Source] [18] Labor Department report: [Source] [19] Crude oil prices jump ahead of US-Russia meeting: [Source] [20] The KLCI finished modestly lower on Thursday: [Source]
[1] Despite the positive outlook for the Malaysian stock market, global equities, particularly in emerging markets like Asia, are performing strongly, attributed to positive stimulus hopes in China and the weakening of the US dollar. [2] This growth in global equities coincides with a trend of emerging markets outperforming developed markets. On the other hand, US markets remain robust, with the S&P 500 hitting new highs due to strong corporate earnings in tech and optimism in trade policies.
