KUALA LUMPUR (ANN/THE STAR) – Following a night of record-breaking feats by prominent US indices, the domestic market is witnessing a resurgence of optimism, even as the benchmark index treads cautiously due to investor discretion.
After a retreat in the preceding session, the FBM KLCI showed signs of recovery, opening slightly higher on Thursday with a 1.15 point increase to 1,604.38.
The release of the US consumer price index for April showed a cooler-than-expected rate of inflation, bolstering hopes the US Federal Reserve could begin cutting rates this year.
The CME FedWatch Tool, which analyses 30-day Fed funds futures pricing data, now projects a 74.5 per cent probability the central bank will cut rates by at least 25 basis points in September.
“In view of the strong momentum in the US, we expect buying interest to spillover towards the local exchange, focusing on the technology sector,” said Malacca Securities Research in a note.
The research firm added that the fresh catalyst of the US imposing higher tariffs on China by stages from 2024 to 2026 will provide a boost to Malaysian companies in view of trade diversions going forward.
“The US imposing higher tariffs on China products may benefit the gloves, semiconductor, EMS, and metal-related industries.
“We also like the construction, building material and property sectors with the ongoing domestic catalysts such as the ongoing mega infrastructure projects and the optimism over NETR and NIMP master plans,” it added.
Following the previous day’s sharp rally, there was profit-taking seen in the glove counters with Top Glove once again topping the most actively traded list.
Seeing heavy trading activity, the world’s largest glove maker shed six sen to MYR1.20.
In the sector, Hartalega fell 24 sen to MYR3.58, Kossan slid nine sen to MYR2.65, Supermax slid eight sen to MYR1 and Careplus dropped three sen to MYR35 sen.
Malaysia Airports dropped 18 sen to MYR10.22 after a consortium led by Khazanah Nasional and the EPF made a takeover offer for the company at MYR11 per share.
