BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The FBM KLCI extended its uptrend for a third session to end 1H 2025 on a firmer note while recouping more of its steep losses during the period.
The extended gains were boosted by calmer market conditions brought about by the recent easing of geopolitical and global trade concerns with most broader market shares also benefitting from the easing headwinds.
As a result, market breadth remained positive that also saw a notable pick-up in market activities with traded volumes rising to nearly 3.6 billion shares yesterday.
Near-term market conditions are likely to remain largely positive due to improved market sentiments from the easing geopolitical and trade barriers which could still provide a leg up to the FBM KLCI to extend its gains.
However, a significant relief rally has yet to emerge as most market players are still weighing the prospects of the Malaysian economy from the introduction of the SST (Sales and Services Tax) and adjustments to electricity rates on the business environment.
As such, there remains tentativeness as market players assess their impact on corporate earnings which may still limit the key index’s upside potential ahead.
With the upsides likely to remain modest, the key index could now target the 1,536-1,540 levels before making an attempt at the 1,545 level. The supports remain at 1,528 points and the 1,520-1,523 levels respectively
Malacca Securities Research
Taking cues from Wall Street’s upbeat performance coupled with FBM KLCI’s undemanding valuations at ~14.x P/E (five-year average: 16.5x) and window dressing activities, the local bourse is set to open on a firmer footing.
We maintain a positive stance on the construction and utility sectors given the FDI (foreign direct investment) flows into the data centres segment.
Also, with Tenaga Nasional Bhd’s capex extending into 2H 2025, we believe this will benefit power infrastructure specialist as well as cable manufacturers going forward.
For a defensive approach, we believe REIT will be favourable to outperform in view of the sector’s average dividend yield which stands at 4%-5%.
With the local bourse having capped another winning day, the key index managed to break above the EMA60 with technical indicators showing bullish signals; the MACD histogram has expanded above zero while the RSI is trading above 50.
Resistance is anticipated around 1,547-1,552 while support is located at 1,512-1,517. – July 1, 2025
