Bank Negara Malaysia’s (BNM) announcement to increase the overnight policy rate by 25 basis points will continue to attract buyers in the banking sector and high net cash companies, Malacca Securities said in a note.
It said that the energy stocks may gain traction as the crude oil price swung higher. “Also, investors may focus on stocks with decent earnings prospects ahead of the earnings season,” the stockbroking firm said.
Malacca Securities said that investors should brace for heightened volatility across global markets as Wall Street tumbled overnight in anticipation of a faster pace of interest rate hikes and potential further tightening in monetary policies after the higher-than-expected inflation data was released.
Nevertheless, it said that recovery-themed and commodities-related sectors may be favourable ahead of the quarterly reporting season. Both the CPO and crude oil rebounded, hovering around RM6,500 and USD107.
On the local bourse, the stockbroking firm said that the FBM KLCI (+0.1%) managed to eke out mild gains, mainly driven by gains in selected banking heavyweights following Bank Negara’s move to increase OPR by 25 basis points. The lower liners and the broader market, however, ended mixed.
On the global markets, Malacca Securities said that Wall Street turned volatile again as the Dow (-1.0%) erased all its intraday gains after the higher-than-expect inflation rate at 8.3% in April 2022 may prompt further tightening measures by the US Federal Reserve. The European stock markets, however, remained upbeat, but Asia stock markets ended mixed.
