BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Profit taking emerged at the start of a new week yesterday on rising uncertainties over the US tariffs that would come into effect in August for countries without a trade deal with the world’s biggest economy.
Local sentiments were further affected by a purported restriction on Malaysia obtaining AI (artificial intelligence) chips from the US.
As a result, most stocks on Bursa Malaysia retreated in tandem with the weak regional indices with losers overwhelmed gainers by a 2-to-1 ratio. Technology and construction stocks were among the big losers.
With the US to impose a broad 25% tariff on Malaysian exports to the country, we see Bursa Malaysia stocks reacting negatively to the latest development with the selling pressure to pick up in the day ahead.
The selling could be steep as investors could opt to reduce their exposure to heavy export reliant stocks in the electrical and electronic, minerals, machinery and chemical industries that are likely to be severely affected by the higher tariffs when they are implemented on 1st August.
At the same time, the purported AI chip exports restriction to Malaysia could further dampen the near-term sentiment on Malaysian equities, particularly on technology-related stocks.
Amid the heightened selling pressure, the key index could retest the 1,500 level again and if that gives way, it could slip further to the recent low of 1,494 points even as there could be some measure of support as Malaysia’s exports to the US only amounts to about 12% of total exports.
On the upside, the resistances are at 1,540 and 1,550 levels respectively.
Malacca Securities Research
With President Trump imposing a 25% tariff on Malaysia starting Aug 1 coupled with his threat to impose an additional 10% tariff on countries aligning with BRICS, we expect the local bourse to trade on a broadly negative tone.
However, we believe the market may shift to more defensive and domestic-driven stocks like 99 Speed Mart Retail Holdings Bhd and Mr DIY Group (M) Bhd.
Meanwhile, as Tenaga Nasional Bhd faces additional taxes from the Inland Revenue Board (LHDN), the recent plunge could be seen as a buy-on-dip opportunity given the utility giant’s continued expansion of power grids as well as riding on the data centre and renewable energy developments.
The Bloomberg consensus target stands at RM16.28, implying an 18.0% upside. Also, investors can look into the upcoming IPO (initial public offering) of Enproserve Group Bhd, (M+ Global target price: 31 sen) that closes today (July 8).
Despite yesterday’s weakness, the local bourse is still trading above both of the EMAs with technical indicators showing mixed signals; the MACD histogram is in the positive territory while the RSI has started to hook down.
Resistance is anticipated around 1,552-1,557 while support is located at 1,517-1,522. – July 8, 2025
