OVER THE weekend, US-Israeli attacks on Iran escalated and could cause second-order impact to Malaysia equities.
Based on Maybank Investment Bank (MIB)’s preliminary assessment, the impact appears limited across selected stocks, though sentiment could cause a negative market reaction as this could be seen as a black swan event should the situation deteriorate.
“Nevertheless, we remain focused on domestic-centric sectors and stocks, led by banks, consumer, construction, healthcare and renewable energy,” said MIB.
As the situation in the Middle East is still developing and remains unpredictable, MIB’s preliminary assessment is minimal impact on Malaysia equities.
“We note that Iran produces about 3% of global crude and condensates, third largest producer in OPEC. We note however that OPEC+ has agreed modest oil output boost even as the situation in Iran disrupts shipments,” said MIB.
This should cushion supply disruption. MIB’s oil price forecast for 2026 is at USD65/bbl. Dialog is their oil & gas sector proxy.
However, the Strait of Hormuz remains a crucial spot as the world’s most important oil route which accounts for over 20% of global oil transit. It was since reported that Strait of Hormuz has been closed.
Meanwhile, the Malaysian Marine Department has advised all Malaysian-registered vessels and local shipping companies to review and reassess voyage routes.
In June 2025, when tensions in the Middle East escalated, there were concerns a full-scale closure could trigger a surge in fuel prices which shipping lines would pass on to customers via higher freight rates.
And if access to Dubai’s Port of Jebel Ali is cut off, transshipment volumes may need to be rerouted to South or South Asian ports causing congestion at these alternative hubs.
Westports could be a beneficiary. The situation in the Middle East remains fluid.
“We would remain focused on domestic-centric sectors, led by banks, as well as consumer, construction, healthcare and renewable energy,” said MIB.
Among KLCI component stocks, banks led the way with 78% reporting results within and 22% beating expectations, while telcos were an upset.
“We have removed CIMB and PMAH from our top picks list after downgrading them to Holds, from Buys, following share price action,” said MIB. —Mar 2, 2026
Main image: ABN AMRO
