Key events in April 2026 affecting the market
Global
Trump declared in a televised speech that the US would strike Iran “extremely hard” in the coming weeks (1 April).
Despite ongoing tensions with Iran, U.S. equities rallied strongly, with the S&P 500 and Nasdaq reaching record highs, driven by optimism around earnings and sustained AI-led demand that continued to support large-cap technology stocks.
The United Arab Emirates officially announced it will exit the Organization of the Petroleum Exporting Countries (28 April). Effective date: 1 May 2026.
Brent crude oil prices surged on 29 and 30 April 2026, jumping above $113 per barrel to hit their highest level since 2022, following reports that the US military would brief President Donald Trump on potential action against Iran, heightening fears that the conflict could escalate further.
Malaysia
April was dominated by a geopolitical and energy shock.
Government workers to work from home to conserve energy costs (2 April).
Malaysia Q1 2026 GDP advance estimate at 5.3% and March CPI at 1.7% (17 April).
All 14 UMNO state assemblymen withdrew support from Menteri Besar Aminuddin Harun (PH), who was accused by UMNO of mishandling this royal issue and failing to consult them. The crisis stems from a royal/institutional dispute in Negeri Sembilan involving the state’s unique Adat Perpatih system and conflicting claims over the ruler and Undang authority (27 April).
Fundamental Outlook and Key events to watch in May 2026
Global
The biggest market-moving dates are in the US: the April employment report on 8 May, April CPI inflation on 12 May, April PPI on 13 May, FOMC minutes on 21 May, and Core PCE Price Index on 28 May. Those releases will determine whether the current energy shock is feeding into a broader inflation rebound or remains largely concentrated in headline prices.
Market attention is increasingly turning to the upcoming Fed chair transition. Kevin Warsh is widely expected to be confirmed as the successor. Warsh’s policy framework will therefore be closely watched. Notably, Warsh has expressed a preference for trimmed mean inflation, a measure that strips out extreme price swings to better capture underlying price trends. By that gauge, trimmed mean core PCE stood at +2.3% YoY in February, below core PCE of +3.0%, potentially pointing to a more favourable assessment of inflation amid today’s supply-driven price pressures.
Another key market focus is the ongoing Iran war, with investors set to closely monitor the latest developments through May. The conflict has already triggered a significant energy supply shock, particularly via disruptions to the Strait of Hormuz—a critical artery for roughly 20% of global oil flows. We think that Donald Trump may seek to bring the conflict under control ahead of a potential meeting with Xi Jinping, in order to refocus US military, economic, and political capital toward strategic competition with China.
In that context, attention is also turning to the potential meeting between Donald Trump and Xi Jinping in Beijing. Such a meeting would carry significant geopolitical weight, particularly against the backdrop of ongoing US–China strategic rivalry, trade frictions, and supply chain realignment. Markets will be watching closely for any signs of de-escalation—whether through renewed trade dialogue, tariff rollbacks, or cooperation in areas such as technology and energy.
Trump signalled a more aggressive stance toward Cuba on 1 May 2026 through expanded sanctions and rhetoric indicating it could emerge as a secondary geopolitical flashpoint alongside Iran. However, we view Cuba as a marginal player in global trade and a net importer economy, with limited integration into key global supply chains. As such, any disruption is unlikely to have a material direct impact on global growth, given its small trade footprint and negligible role in semiconductors, global manufacturing, and critical logistics networks.
Malaysia
The domestic calendar is busy and important. The main events are BNM’s MPC on 7 May, labour force data on 12 May, Q1 GDP on 15 May, CPI inflation on 19 May, and external trade statistics on 20 May. BNM’s earlier guidance suggests policy is on hold for now, but the May MPC will be watched for any shift in tone on inflation, the ringgit, and energy-related volatility. As of now, our economist continues to expect that BNM will keep the OPR unchanged at 2.75% through 2026 to preserve growth. Key factors influencing policy decisions will include how higher crude oil prices feed into overall inflation, as well as the resilience of domestic demand.
The upcoming earnings season will be watched for early signs of Iran war spillover. While Q1 impact should be partial, management guidance will be key in assessing how higher energy costs and supply disruptions are feeding into margins, and whether resilient domestic demand can offset rising pressures.
The Negeri Sembilan state crisis is casting doubt on the stability of the federal unity government, while also reshaping expectations around future state elections and political alliances. Markets will be watching closely for potential spillover effects at the national level, including any implications for the timing of the next general election.
Our View
We are of the view that the market will likely remain range-bound in May as investors weigh potential earnings risks from rising costs, slower global growth and heightened geopolitical uncertainty stemming from the Iran conflict. Moreover, a potential meeting between Donald Trump and Xi Jinping could introduce episodic risk-on/risk-off swings depending on signals of escalation or de-escalation.
Domestically, the unfolding Negeri Sembilan state crisis adds a degree of political uncertainty, but such developments are not uncommon in Malaysia and largely reflect a familiar centre–state dynamic. Importantly, we do not see this translating into broader tensions between UMNO and PH at the federal level. As such, we see the PH–BN cooperation model remaining intact, at least until the next general election approaches.
That said, we expect market downside to be capped by earnings lift from the resilient domestic demand, continued strength in the AI-driven technology upcycle, ongoing data centre investments, and sustained momentum in E&E exports. These structural tailwinds should help cushion against external headwinds. Our top three picks are ViTrox, Mi Technovation, and MSC.
Technical outlook for May 2026F
The benchmark KLCI index ended April at 1722.02, up 31.66pts or 1.9% for the month. The index has been consolidating within a Symmetrical Triangle formation since February 2026. While it recently attempted an upside breakout, the move was not sustained (See Figure 2).
In May, we expect the KLCI to continue trading within this range until a clearer breakout emerges. A decisive move above the 1,720–1,730 zone could pave the way for a rally towards 1,777, while immediate support is seen at 1,685–1,690, followed by a key floor at 1,660.
Despite the near-term consolidation, our longer-term outlook remains constructive. We maintain our FBM KLCI year-end target of 1,787, based on our Elliott Wave framework (Figure 3). With the complex WXY correction likely complete, we expect the index to transition into a new five-wave impulsive uptrend.
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| Currency | Buy Rates (RM) | Sell Rates (RM) |
|---|---|---|
| USD | 3.957248 | 3.985040 |
| EUR | 4.657427 | 4.662302 |
| CNY | 0.580849 | 0.581472 |
| HKD | 0.505093 | 0.508667 |
| SGD | 3.108871 | 3.130951 |