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Trump-Xi Accord Eases Market Anxiety
Fri, 15-May-2026 07:25 am
by Research Team • Apex Research

Malaysian Market Review: The FBMKLCI edged marginally lower (-0.04%) to 1,745.58 on Thursday, as banking stocks weighed on the market amid profit-taking and cautious regional sentiment ahead of the Trump-Xi summit, with investors avoiding aggressive risk positions pending greater clarity on US-China trade relations and the broader geopolitical landscape. Market breadth turned slightly positive with 588 gainers against 572 decliners. Sector wise, Consumer (+1.03%), Industrials (+0.77%) and Technology (+0.63%) led gains, while Energy (- 0.76%), Transportation (-0.58%) and Plantation (-0.54%) were the main laggards.

Global Markets: U.S. equities closed at fresh record highs on Thursday, with the S&P 500 rising (+0.77%) and the Nasdaq Composite gaining (+0.88%), while the Dow Jones Industrial Average advanced (+0.75%) to reclaim the 50,000 level. Sentiment was supported by strong technology earnings, with Cisco surging (+13%) after upbeat results and Nvidia climbing (+4%) after the U.S. approved sales of its H200 chips to approximately 10 Chinese firms. Meanwhile, risk appetite also improved after President Donald Trump and Chinese President Xi Jinping agreed during their Beijing summit that the Strait of Hormuz should remain open. European equities closed broadly higher on Thursday, with the STOXX600 gaining (+0.76%) as tech and media stocks led gains amid optimism surrounding Trump's Beijing summit with Xi Jinping, while UK political uncertainty eased after gilt yields fell across the curve. Asian markets closed mixed on Thursday, with South Korea's Kospi surging (+1.75%) as Samsung shares rebounded sharply after Wednesday's labor disputedriven selloff, while the Nikkei 225 (-0.98%) and Shanghai Composite (-1.52%) retreated as investors awaited the outcome of the Trump-Xi summit in Beijing, with Goldman Sachs expecting the meeting to act as a "tactical catalyst" for Chinese equities and the yuan rather than a sweeping bilateral reset (CNBC).

Market Outlook. The Trump-Xi summit in Beijing has injected cautious optimism into the geopolitical outlook, with both leaders agreeing that the Strait of Hormuz "must remain open to support the free flow of energy" and that Iran can never have a nuclear weapon, while Trump claimed Xi offered to help broker peace and pledged not to supply Tehran with military equipment (CNBC). In a further positive signal, 26 nations including Britain, France, Japan, South Korea and Qatar pledged support for an independent multinational military mission to protect shipping in the strait once conditions permit, though the operation remains contingent on a sustainable ceasefire (CNN). However, the situation on the ground remains fragile as Iran seized a research vessel off the UAE coast on Thursday, while Iran's Revolutionary Guard claimed dozens of ships had passed through the strait under its "management protocols" - a far cry from the approximately 140 daily transits before the war (Al Jazeera, Sky News). Brent crude steadied around USD106 per barrel on Thursday, easing from recent highs on the Trump-Xi accord, though the International Energy Agency warned that the global oil market will remain severely undersupplied until October even if the conflict ends next month, with observed stockpiles falling at an average rate of approximately 4 million barrels per day over March and April (IEA). Adding to supply-side concerns, Saudi Arabia informed OPEC that its oil production had dropped to its lowest level since 1990, underscoring the depth of the energy crisis triggered by the Strait of Hormuz closure (Reuters). For the FBMKLCI, sentiment may improve modestly on the diplomatic progress, though investors are likely to remain selective and range-bound pending concrete follow-through on the Trump-Xi commitments and clarity on Iran's response.

Sector focus. We favour Technology as the primary near-term play, with momentum accelerating after the US cleared approximately 10 Chinese firms to purchase Nvidia's H200 chips and Nvidia itself surging (+4%) on Thursday, reinforcing the structural AI demand narrative and potentially opening a new wave of US-China semiconductor cooperation. Energy may see some near-term profit-taking as the Trump-Xi agreement on the Strait of Hormuz introduces tentative deescalation hopes, though Brent crude remains above $106 per barrel and the IEA's warning that markets will stay undersupplied until October suggests the energy trade has further to run (Reuters).

 

FBMKLCI Technical Outlook


Technical Commentary: The benchmark FBM KLCI has broken above its Symmetrical Triangle formation, signalling potential upside towards the 1,777 level and confirming a continuation of the broader uptrend following a three-month consolidation phase. However, the formation of an inverted Hammer candlestick near the recent high suggests the index may experience near-term pullback or profit-taking activity after the recent rally. Immediate support is pegged at 1,735.

 

Company News


Public Bank Bhd reported a flat 1QFY2026 net profit of RM1.75 billion, unchanged year-on-year, as intense competition and volatile markets persisted, with the group flagging "unprecedented" external headwinds despite revenue edging up marginally to RM7.32 billion. (The Edge)

Gas Malaysia Bhd posted a 7% decline in 1QFY2026 net profit to RM92.84 million on lower average natural gas selling prices, with revenue falling (-13.3%) to RM1.59 billion from RM1.84 billion a year earlier. (The Edge)

Keyfield International Bhd saw its 1QFY2026 net profit more than double to RM56.13 million on a one-off gain from the disposal of its accommodation workboat, despite revenue declining (- 45.61%) to RM47.18 million on lower vessel utilisation, and declared a first interim dividend of one sen per share payable June 16. (The Edge)

Duopharma Biotech Bhd posted a 20% rise in 1QFY2026 net profit to RM30.71 million, driven by a favourable product mix, improved efficiency and ringgit strength easing input costs, though revenue fell (-5.65%) to RM247.88 million on lower public sector insulin demand. (The Edge)

AirAsia X Bhd swung to a 1QFY2026 net loss of RM154.9 million from a net profit of RM50.2 million a year earlier, as foreign exchange losses and higher fuel costs outweighed record revenue of RM5.95 billion following the completion of the Capital A aviation business acquisition. (The Edge)

Sentral REIT posted a marginal 1.1% rise in 1QFY2026 net profit to RM19.82 million, supported by a full-quarter contribution from Arcoris Mont Kiara and improved performance from existing assets. (The Edge)

Ranhill Utilities Bhd reported a 3QFY2026 net profit of RM58.4 million on revenue of RM612.5 million driven by its Johor water unit, and has expressed interest in bidding for the Sabah Large Scale Solar 2026 project. (The Edge)

Media Prima Bhd disclosed that its public shareholding spread has slipped to 24.38%, below the minimum 25% threshold required under listing regulations, and will take steps to address the shortfall. (The Edge)

EG Industries Bhd secured its largest contract to date - a RM949 million purchase order for 800G optical modules and wireless access products to be fulfilled over 12 months, sending shares to a 25-year high. (The Edge)

Fima Corp Bhd secured a RM197.09 million five-year contract from the Ministry of Education for the printing and supply of confidential documents via its subsidiary Percetakan Keselamatan Nasional. (The Edge)

Destini Bhd secured a five-year tubular running services contract with PETRONAS Carigali Sdn Bhd covering the West Region, marking its first major contract win of the year. (The Edge)

Maxland Bhd scrapped two planned land leases in Kulim Hi-Tech Park, Kedah, for a proposed data centre and district cooling system after revising its business strategy. (The Edge)
 

Sentiment: Positive
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