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Market Sentiment Remains Muted
Fri, 02-Jan-2026 07:40 am
by Research Team • Apex Research

Malaysia Market Review: The FBM KLCI fell 0.3% to close at 1,680.1 on the final trading day of the year on Wednesday. In the absence of fresh catalysts, sentiment remained muted, while market breadth was negative with 533 decliners outpacing 465 advancers. Sector-wise, Technology (-1.0%), Construction (-0.6%) and Utilities (-0.4%) weighed on the index, while Property (+0.7%) and Transportation & Logistics (+0.3%) provided modest support.

Global Markets Review: Wall Street ended 2025 on a lacklustre note, with the Dow (-0.6%), S&P 500 (-0.7%) and Nasdaq (-0.8%) extending post-Christmas losses for a fourth straight session amid profit-taking activity. In Europe, the STOXX 600 eased 0.1% in a shortened session, closing just below its record high as most sectors ended in the red. Asian markets were mixed, with the Hang Seng falling 0.9% and the Shanghai Composite edging up 0.1%, while Japan’s Nikkei 225 and Korea’s KOSPI were closed for the New Year holiday.

Market Outlook. With year-end window dressing activities concluded, we expect the FBM KLCI to face some profit-taking today. Further out, as we enter 2026, we remain positive on the local bourse, supported by an improving domestic economic outlook. Globally, expectations of a Fed easing cycle should continue to underpin market sentiment this year. That said, investors should brace for bouts of volatility, as the pace of Fed easing remains data-dependent amid shifting inflation and labour market conditions. Markets currently price in a cumulative 50-bp rate cut by end-2026, according to CME FedWatch. 

Sector focus. While near-term volatility in the global technology sector may persist, the underlying AI theme remains intact in 2026, which should continue to benefit selected local technology and AI-related names. Meanwhile, we favour domestic-oriented consumer staples and tourism names, supported by a firmer ringgit, an improving domestic economic backdrop and resilient tourism spending as Visit Malaysia 2026 kicks off. We remain positive on selective power-ancillary and renewable-energy names, underpinned by long-term energy transition trends that support earnings resilience and ongoing investor rotation amid prolonged global trade uncertainty. 

Technical Commentary: The FBM KLCI ended the final 2025 session lower after failing to break above its 2024 all-time high resistance, signalling lingering overhead supply. Indicators remained positive, with the MACD line trading above the signal line and the RSI remaining above 50. The next resistance is located at 1,700, while support is envisaged around 1,640.     

Company News (source: various)

Axis Real Estate Investment Trust is acquiring an industrial property in Senai, Johor, for RM34.6 million.

Capital A Bhd has applied for more time to complete its proposed distribution of AirAsia X Bhd shares to entitled shareholders, due to an expected delay in AAX's private placement exercise. 

British American Tobacco (Malaysia) Bhd has appointed Datuk Seri Mohd Nizom Sairi as its new independent non-executive chairman. 

Berjaya Assets Bhd has appointed Tan Tee Ming, the son-in-law of controlling shareholder Tan Sri Vincent Tan Chee Yioun, as its new chief executive officer, effective Jan 1, 2026.

Malaysia Smelting Corporation Bhd has promoted its deputy chief executive officer Nicolas Chen Seong Lee and group chief financial officer Lam Hoi Khong as co-group CEOs effective Jan 1, 2026.

CJ Century Logistics Holdings Bhd’s CEO Steven Teow Choo Hing has ceased to be a substantial shareholder of the total logistics provider after disposing of 44.87 million shares — equivalent to a 7.71% stake in the company.

TSH Resources Bhd’s chairman and founder Datuk Kelvin Tan Aik Pen, 68, is set to resume his role as managing director of Innoprise Plantations Bhd, effective Jan 1.

Sentiment: Neutral
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