Malaysian Market Review. The FBM KLCI fell 21.57 points, or 1.32%, to 1,611.78 on Wednesday, from Tuesday's close of 1,633.35, with market breadth turning negative as losers led gainers 663 to 492. Selling pressure intensified as the benchmark broke below key support levels, led by heavy selling in banking stocks following JPMorgan’s downgrades of CIMB and AMMB, alongside concerns over elevated bond yields. Sentiment was further weighed by weaker regional markets and renewed gains in crude oil following Houthi attacks in Saudi Arabia, keeping investors defensive and cautious on the inflation and monetary easing outlook ahead of the tabling of Budget 2027 on Friday. Construction (+1.22%) and Technology (+1.12%) topped the gainers, while Finance (-2.65%) and Healthcare (-2.46%) led the laggards.
Global Markets. U.S. equities fell on Wednesday as pressure built in the bond market, with the Dow losing 341.41 points, or 0.66%, to 51,179.87, the S&P 500 shedding 0.22% to 7,801.77, and the Nasdaq slipping 0.22% to 27,538.69. The 10-year Treasury yield hit 5.365%, its highest since April 2002, though it pared gains after a solid $39 billion auction, while minutes from the Fed's September meeting showed most officials expect another rate increase by year end. Bank and technology stocks led the declines on fears that higher rates would hinder lending and the AI buildout. Meanwhile, Europe's STOXX 600 dropped 1.00% to 630.25, weighed down by elevated bond yields and renewed gains in crude oil following Houthi attacks in Saudi Arabia. Asian markets traded broadly lower on Wednesday, with South Korea's KOSPI falling 1.98%, while Japan's Nikkei 225 fell 0.92% and Hong Kong's Hang Seng dropped 0.62%, as sentiment was dampened by renewed West Asia supply concerns. (CNBC)
Market Outlook. With the Fed minutes pointing to another hike by year end and Treasury yields at multi-decade highs, the margin for error on earnings has narrowed, leaving equities vulnerable to further bond market pressure even though inflation expectations remain well anchored and a strong earnings season could still carry the market higher. We stay cautious on near-term global risk appetite, as the rally remains narrowly led by technology and rising borrowing costs threaten both financial and AI-linked names. For KLCI, attention will turn to Budget 2027 on Friday, which could provide fresh domestic catalysts, but elevated crude oil prices, geopolitical tensions in West Asia and high global bond yields are likely to keep investors defensive. We stay cautious to conservative on the local bourse, as the break below key support and persistent external headwinds are likely to cap any rebound until there is greater clarity from the Budget and from bond yield and oil price developments.
Sector focus. Construction and Technology counters may extend their gains, supported by selective buying and the government's focus on infrastructure, semiconductors and digitalisation ahead of Budget 2027 on Friday. Conversely, Finance may stay under pressure as elevated US Treasury yields and persistent foreign selling continue to weigh on rate-sensitive and heavyweight counters.
Technical Commentary: The FBM KLCI tumbled 21.57 points or 1.32% to close at 1,611.78. The index has decisively broken below 1,625, confirming that the downtrend remains intact, while price continues to trade well below all key moving averages. The 1,650–1,660 resistance zone remains well above the current level, highlighting the significant distance needed to challenge the downtrend. With 1,625 now broken, the index is exposed to the psychological 1,600 level, with a break below potentially opening the way towards 1,580. Unless the index quickly reclaims 1,625–1,650, the bearish outlook is likely to persist.
Company News
Yinson Azalea Production Pte Ltd, an indirect wholly-owned subsidiary of Yinson Holdings Bhd, said it has officially priced US$1.46 billion (RM6.21 billion) in senior secured notes for its Agogo floating production, storage and offloading (FPSO) vessel. (The Edge)
Northern Solar Holdings Bhd has secured a RM34 million engineering, procurement, construction and commissioning (EPCC) contract to develop a 9.5MW large-scale solar photovoltaic plant. (The Edge)
Aemulus Holdings Bhd has secured new orders worth US$3.86 million (RM15.77 million) from an undisclosed Singapore customer for test systems used in the data centre and artificial intelligence (AI) market. (The Edge)
Datasonic Group Bhd has terminated its proposed acquisition of a RM28.5 million industrial property in Petaling Jaya after failing to get Fire and Rescue Department approval for fire safety equipment. (The Edge)
CIMB Group Holdings Bhd, Malaysia’s second-largest lender by assets, fell to its lowest in three months as banking stocks fell amid persistent concerns over rising bond yields. (The Edge)
Bursa Malaysia has approved PJBumi Bhd’s proposed share split, expected to boost trading liquidity and attract a broader investor base by lowering trading prices. (The Edge)
Bursa Malaysia has dismissed MMM Group Bhd’s appeal against the rejection of its proposed regularisation plan, paving the way for the company to be delisted on Oct 12. (The Edge)
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| Currency | Buy Rates (RM) | Sell Rates (RM) |
|---|---|---|
| USD | 4.072348 | 4.102922 |
| EUR | 4.575710 | 4.578149 |
| CNY | 0.609322 | 0.609632 |
| HKD | 0.519129 | 0.522523 |
| SGD | 3.183470 | 3.204338 |