Bursa Malaysia’s benchmark index will likely end 2021 lower than what Rakuten Trade has expected earlier. The firm revised downward its end-2021 target for the FBM KLCI by 45 points to 1,585 points.
The online retail brokerage firm also expects the FBM KLCI to hit 1,700 level by the end of next year, driven by the anticipated heightened volatility on the Wall Street market in the United States.
This could trigger funds to flow into Asia including Malaysia.
Rakuten Trade head of research Kenny Yee said it did not expect a valuation premium to return anytime soon despite the presence of some foreign funds. Speaking at its virtual 2022 Market Outlook media briefing today, Yee said one factor contributing to its revised forecast was the changing landscape.
“We revised down our FBM KLCI target to 1,585 points by end-this year from 1,630 points as we do not foresee a valuation premium to return anytime soon despite the presence of some foreign funds.
“Sentiment has been affected by the recent announcement of the 2022 Budget, so we expect a lower valuation for our market this year and also next year. That is why we have revised down our target for this year,” he said.
