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Cautious Ahead of Budget 2027
Tue, 06-Oct-2026 07:04 am
by Research Team • Apex Research

Malaysian Market Review. The FBM KLCI edged up 0.88 of a point, or 0.05%, to 1,631.75 on Monday, from Friday's close of 1,630.87, although market breadth was slightly negative, with losers leading gainers 599 to 564. Investors largely stayed on the sidelines amid the absence of market-moving factors, with selective buying seen in technology and semiconductor-related counters, as participants remained cautious ahead of the tabling of Budget 2027 on Friday. Technology (+1.74%) and Healthcare (+1.43%) topped the gainers, while Construction (-1.46%) and Plantation (-1.39%) led the laggards.

 

Global Markets. The Nasdaq Composite sailed to a fresh all-time high on Monday as traders looked past rising U.S. Treasury yields, rising 1.05% to a record close of 27,477.31, while the S&P 500 climbed 0.66% to 7,773.95 and the Dow advanced 0.18%, to 51,267.90. AI-linked stocks led the gains, with SpaceX jumping more than 7%, Meta Platforms and Microsoft rising almost 2% and more than 1% respectively. The ISM services PMI came in at 54.9% in September, roughly in line with expectations, while Brent crude settled down to c.$100 a barrel and WTI fell to c.$89. Meanwhile, Europe's STOXX 600 rose 0.36% to 633.62, supported by easing oil prices and selective buying in defensive counters. Asian markets traded mixed on Monday, with South Korea's KOSPI closed for a holiday, while Japan's Nikkei 225 surged 2.40%. Hong Kong's Hang Seng edged up 0.28% following the previous session's sharp decline. (CNBC) 

 

Market Outlook. Attention now turns to the minutes of the Fed's September meeting, which may shed light on its decision to hike rates by a quarter point last month. While global equities have climbed around 12% year-to-date and remain just below all-time highs, we stay cautious, as the rally is narrowly led by tech and elevated bond yields remain a key risk if the Fed stays higher for longer. We stay cautious on the KLCI this week, as the absence of market-moving factors and the Budget 2027 tabling on Friday are likely to keep participants on the sidelines, with selective buying likely to continue but upside limited until greater clarity emerges on the Budget and external conditions such as bond yields and crude oil prices.

 

Sector focus. Technology counter may extend its gain, supported by continued selective buying in technology and semiconductor-related names amid gains in regional markets. Construction and Plantation could stay under pressure after leading Monday's declines, as investors remain on the sidelines and hold back from fresh positions ahead of the tabling of Budget 2027 on Friday.

 

Technical Commentary: The FBM KLCI rose slightly to close at 1,631.75 (+0.05%), but the small gain does little to improve the overall weak market outlook. The index remains below the 1,650–1,660 resistance zone and all key moving averages, keeping the near-term outlook weak. A break below this level would expose the index to a retest of the psychological 1,600 mark, with further downside risk if selling pressure intensifies. On the upside, the index is likely to face strong resistance at 1,650–1,660, where the descending trendline and moving averages converge. Until the index breaks above that zone convincingly, the market is still more likely to move lower, with the current rise looking more like a temporary pause than a real recovery.

 

Company News 

Transport Minister Anthony Loke Siew Fook told reporters that the suspension of Zetrix AI Bhd and subsidiary MyEG stemmed from RM314 million in unremitted Road Transport Department collections from May to September. (The Edge)

 

eJamin, an online bail payment system operated by a unit of Practice Note 17 company Pertama Digital Bhd, ran for five years without a formal contract, the Public Accounts Committee found. (The Edge)

 

Yinson Holdings Bhd has secured about US$600 million (RM2.5 billion) in additional firm contract backlog following an amendment to its contract for the FPSO John Agyekum Kufuor offshore of Ghana. (The Edge)

 

Kelington Group Bhd said its wholly owned unit has been awarded a second contract by a manufacturer operating in the Sama Jaya Free Industrial Zone in Kuching, Sarawak, worth about RM133 million. (The Edge)

 

Information technology solutions provider Go Hub Capital Bhd has secured a five-year service contract worth RM65 million from Keretapi Tanah Melayu (KTMB) unit Tenang Capital Bhd. (The Edge)

 

Citaglobal Bhd, via indirect unit LAWI Engineering GmbH (LAWI Germany), has secured a RM29 million share of a RM52.1 million contract for a waste-to-energy (WTE) project in Thailand. (The Edge)

 

West River Bhd has secured a RM17.5 million subcontract for electrical, security and solar panel system works at the E-Metro Logistic Park in Bandar Bukit Raja 2, Selangor. (The Edge)

 

Jati Tinggi Group Bhd has secured two contracts from Tenaga Nasional Bhd (TNB) worth a combined RM15.7 million. (The Edge)

 

IJM Corporation Bhd has appointed non-executive chairman of KPMG Malaysia Datuk Johan Idris as its independent non-executive director and chairman, effective Monday. (The Edge)

 

Datuk Clifford Hii Toh Leong has increased his stake in Asteel Group Bhd to 53.08% following the close of his unconditional mandatory takeover offer on Monday. (The Edge)

Sentiment: Neutral
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