KUALA LUMPUR, June 12 (Bernama) -- Selected blue-chip counters trading at attractive valuations helped Bursa Malaysia close higher on Friday, despite cautious market sentiment driven by developments in West Asia, volatility in crude oil prices and uncertainty over the global interest rate outlook. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose by 4.10 points or 0.24 per cent to 1,683.63 compared with Thursday's close of 1,679.53. The key index opened 5.34 points stronger at 1,684.87 earlier today and moved between 1,679.72 and 1,685.39 throughout the session. Market breadth was negative, with losers leading gainers 533 to 479, while 561 counters were unchanged, 1,130 untraded and 33 suspended. Turnover fell to 2.79 billion units worth RM2.31 billion from 3.32 billion units worth RM2.88 billion yesterday.
Kenanga Research’s analysis of Malaysia’s new “Appreciation Package” highlights both short-term economic benefits and long-term fiscal challenges:
Key Measures:
RM100 cash aid (Sumbangan Asas Rahmah – SARA Untuk Semua) for all eligible Malaysians.
Reduction in RON95 petrol prices to RM1.99/litre (from RM2.05) for eligible groups.
Package cost estimated at RM2.8 billion (~0.14% of GDP).
Economic Impact:
✅ Boost to private consumption in 2H25, supporting GDP growth at 4.3% (vs. 5.1% in 2024).
✅ Expected to offset trade risks from global tariffs and support domestic demand.
✅ Inflation forecast revised down to 1.7% (from 2.0%) due to fuel price cuts.
Fiscal Trade-offs:
⚠️ Fiscal deficit for 2025 projected at 4.1% of GDP, exceeding the initial 3.8% target.
⚠️ Government debt expected to hit RM1.33 trillion (65.9% of GDP), potentially breaching the statutory debt ceiling (65%).
Fuel Subsidy Reform:
Targeted RON95 subsidy reform rollout now planned for 4Q25.
Move aims to prevent leakage and direct benefits to ordinary Malaysians.
SST on fuels is being discussed as a possible offset to fiscal pressure.
Takeaway:
The package is seen as a “redistribution of macro gains” rather than a true stimulus. It delivers political and social relief while raising the tension between near-term social spending and medium-term fiscal discipline.
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