KUALA LUMPUR, Sept 8 (Bernama) -- Bursa Malaysia closed almost flat on Tuesday as buying interest rotated away from index heavyweights towards smaller-cap construction stocks, with sentiment affected by geopolitical uncertainty, said an analyst. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) eased 0.39 of a point to 1,714.40 from Monday’s close of 1,714.79. The benchmark index opened 1.65 points lower at 1,713.14 and moved between 1,710.44 and 1,714.50 throughout the trading session. The broader market was almost evenly balanced, with decliners leading gainers 548 to 546, while 598 counters were unchanged, 1,107 were untraded and 25 were suspended. Turnover expanded to 4.13 billion units valued at RM3.14 billion from 3.60 billion units valued at RM2.45 billion on Monday.
Economists anticipate Malaysia’s trade performance to strengthen in the second half of 2024, supported by a resurgence in the global technology cycle, resilient economic growth in major economies, and potential increases in commodity prices.
Key Points:
Positive Outlook:
- RHB Bank’s Economic and Market Strategy report predicts export-oriented sectors, such as electrical and electronic (E&E) products and commodity-based goods, will benefit from brighter global growth prospects.
- The global semiconductor market showed a 19.3% year-on-year increase in May 2024, driven by strong growth in the Americas and Asia-Pacific regions.
June Export Data:
- June’s export growth decelerated to 1.7% y-o-y (RM126.05 billion), below the consensus estimate of 3.3%. The slowdown was attributed to sluggish exports of manufactured and agricultural goods amid high base effects from the previous year.
Commodity Exports:
- RHB expects higher commodity prices to boost exports of petroleum and petroleum-based products, and non-metal mineral and metal products.
- UOB Global Economics & Market Research cautions that commodity exports, especially mining goods, may face production shocks due to maintenance and global price fluctuations.
Forecasts:
- UOB maintains a full-year export growth forecast of 3.5%, citing recovery in world trade, logistical challenges, and geopolitical risks. Upside risks include improvements in E&E exports and higher commodity prices.
- MIDF Research projects improved export growth momentum in 2H2024, driven by a recovery in the global E&E market.
Import Performance:
- Excluding February 2024, Malaysia’s imports have grown at double-digit rates since January 2024. June imports rose by 17.8% y-o-y due to stronger intermediate goods imports (37.2% y-o-y).
- MIDF upgraded its import growth forecast to 11.2%, noting a robust import growth of 13.8% y-o-y in 1H2024 compared to export growth of 3.9% y-o-y.
Trade Surplus:
- June’s trade surplus reached a nine-month high of RM14.3 billion.
- For the entire year, the current account surplus is projected to reach RM39 billion or 2% of GDP, aligning with Bank Negara Malaysia’s estimation of RM41.5 billion or 1.8%-2.8% of GDP. This is higher than the RM28.2 billion or 1.5% of GDP recorded in 2023, reflecting an expected recovery in the trade sector this year.
Economists remain optimistic about Malaysia’s trade outlook, anticipating growth in export-oriented sectors and commodities, despite some short-term challenges.
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