Bursa Malaysia's main index set to trade within 1,420-1,440 level next week

KUALA LUMPUR - Interest for beaten down counters is set to boost Bursa Malaysia’s performance with the main index expected to trade within the 1,420-1,440 level next week, said Rakuten Trade Sdn Bhd.

Its equity research vice president, Thong Pak Leng said valuations of Malaysian equities remained cheap, which presents opportunities for investors to bargain hunt stocks at a lower level.

"Additionally, we expect the overall outlook in the mid-term to be positively buoyed by improving economic conditions,” he told Bernama.

Meanwhile, an analyst said next week’s United States March ISM Manufacturing Purchasing Managers Index (PMI) and jobless claims data will be closely monitored to gauge the US Federal Reserve’s (Fed) future interest rate path.

On March 22, the Fed raised interest rates by another 25 basis points despite the stress hitting its banking system and indicated another hike to come.

China’s Caixin and Eurozone PMI prints will also be released on Monday.

The US manufacturing sector continued to contract in February, albeit at a softer pace compared to January as the ISM Manufacturing PMI edged higher to 47.7 from 47.4, while China’s Caixin index climbed back into the expansionary territory at 51.6 after six straight months of contraction.

The analyst said Cleveland Fed president Loretta Mester and St Louis Fed president James Bullard’s speeches during the week, followed by US weekly initial jobless claims on Friday will also be carefully watched.

Overall, Fed officials expect the unemployment rate to reach 4.5 per cent by the end of 2023.

During the week, Bursa Malaysia was traded higher from Tuesday to Thursday before ending the week in the red due to profit-taking activities.

The absence of negative headlines about the US and Europe banking crisis helped to boost sentiment domestically and globally.

The market also cheered about the collapsed Silicon Valley Bank to be acquired by First Citizens Bank.

At home, Bank Negara Malaysia governor Nor Shamsiah Mohd Yunus gave assurance that the US and Europe banking crisis is unlikely to happen in Malaysia as banks in the country are still resilient in severe adverse scenarios.

She pointed out that all banks in Malaysia are subjected to stringent capital and regulative rules to ensure the safety and stability of the banking system.

"Regardless of your size, you are subject to the same rules, unlike in the US where such rules are only applicable to the large banks,” the governor said.

On a Friday-to-Friday basis, the FBM KLCI expanded 22.89 points to end at 1,422.59 from last week’s 1,399.70.

On the index board, the FBM Emas Index climbed 161.45 points to 10,419.63, the FBMT 100 Index jumped 162.20 points to 10,114.03, the FBM Emas Shariah Index surged 117.22 points to 10,716.43 and the FBM 70 Index soared 214.66 points to 13,512.38.

Meanwhile, the FBM ACE Index lost 77.02 points to 5,226.80.

Sector-wise, the Financial Services Index chalked up 259.18 points to 15,708.70, the Energy Index rose 33.93 points to 836.81, the Industrial Products and Services Index was 5.54 points higher at 171.08 and the Plantation Index increased 27.35 points to 6,741.28.

Weekly turnover increased to 16.21 billion units worth RM8.36 billion from last week’s 16.06 billion units worth RM9.62 billion.

The Main Market volume eased slightly to 10.54 billion shares valued at RM6.92 billion against 10.56 billion shares valued at RM8.25 billion a week ago.

Warrant turnover was lower at 1.94 billion units worth RM332.66 million from 2.18 billion units worth RM338.05 million previously.

The ACE Market volume improved to 3.71 billion shares worth RM1.10 billion against 3.28 billion shares worth RM1.02 billion. - BERNAMA