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Staying cautious amid Fed hawkish tone
Thu, 19-Jun-2025 07:09 am
by Research Team • Apex Research

Market Review & Outlook

Malaysia Market Review: The FBM KLCI closed relatively flat, gaining a marginal +0.02%, as the market showed modest resilience amid ongoing geopolitical tensions and in anticipation of the FOMC meeting. Lower liners also ended mostly flat, with trading confined within a tight range, reflecting investor caution amid persistent volatility in both regional and global markets. Sector-wise, the Transport (+0.45%) and Utilities (+0.30%) sectors outperformed, while Telecommunication (-0.94%) saw the largest decline.

 

Global Markets Review: Wall Street closed modestly lower, erasing earlier gains after the Federal Reserve held interest rates unchanged, as widely expected, but signalled no urgency to cut rates soon. The Fed’s cautious stance, coupled with uncertainty over the impact of President Donald Trump’s policies, weighed on sentiment. European markets ended lower ahead of the FOMC announcement, as investors monitored developments in the Middle East and awaited central bank guidance. Asian markets were mixed, reflecting a cautious mood amid geopolitical uncertainties and key policy decisions.

 

Market Outlook: The Malaysian stock market is expected to open lower in line with regional markets, following hawkish comments from the Fed chairman highlighting tariff-driven economic uncertainty and lingering inflation risks that complicate the central bank’s efforts to ease policy. Meanwhile, geopolitical tensions in the Middle East remain unresolved and continue to influence market sentiment. Investors will also be watching key economic data, including the upcoming US jobs reports later this week, which could provide further insight into the health of the US economy. Overall, the market is expected to remain range-bound and volatile, with a selective and defensive approach advisable until clearer catalysts emerge.

 

Sector focus. Defensive sectors such as REITs, banks, and utilities remain favoured as investors seek stability amid ongoing volatility. The Energy sector will continue to draw attention given the escalating geopolitical tensions in the Middle East, which support commodity prices and related stocks.

 

FBMKLCI Technical Outlook

Technical Commentary: The FBM KLCI extended its slide to tip below the middle Bollinger Band on yesterday. Indicators remained negative as MACD Line hovered below the Signal Line, while the RSI lingered below 50. Immediate resistance is located at 1,550, followed by 1,600. Support is envisaged around 1,500.

 

Company News (source: various)

Pharmaniaga Bhd said it will continue to stay in the black for the financial year ending Dec 31, 2025 (FY2025) after making a turnaround last year

 

Scientex Bhd saw its net profit slip over 5% for the third financial quarter, as the improved operating profit at its property segment was more than offset by a weaker packaging division.

 

Dagang NeXchange Bhd has secured a RM103.76 million contract from the government to continue providing support for the Integrated Government Financial and Management Systems (iGFMAS) over a period of 60 months.

 

MN Holdings Bhd said it has secured a RM39.59 million contract for the expansion of the electrical supply system for a cable landing station. 

 

Guocoland (Malaysia) Bhd said the group faces a net financial impact of RM5.54 million following an arbitration ruling against its wholly owned subsidiary over a disputed project termination.

 

 LGMS Bhd, which was listed on Bursa Malaysia's ACE Market in June 2022, has proposed to transfer its listing to the Main Market, saying that it has met the profit requirements for the transfer. 

 

Farm Price Holdings Bhd has proposed to expand its sale of fruits, frozen food and other grocery products through the acquisition of the business and assets of two Johor-based firms for RM4.5 million in cash. 

 

Kobay Technology Bhd plans to reallocate RM20.74 million — part of the funds originally set aside for its aluminium business expansion — to develop manufacturing services for the electronic and electrical (E&E) sector. 

Sentiment: Neutral
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