KUALA LUMPUR (July 3): Next week, the Bursa Malaysia is likely to trade in a narrow range of 1,530 to 1,540 points. Investors will keenly observe the upcoming Monetary Policy Committee (MPC) on the overnight policy rate (OPR), which is planned for July 8, according to Bank Islam Malaysia Bhd economist Adam Mohamed Rahim.
“The existing OPR of 1.75 percent is likely to be maintained by Bank Negara Malaysia (BNM).”
“A rate hike in 2021 is premature,” he told Bernama, pointing out that the country was still recovering, with daily new coronavirus infections hovering around 5,000.
“As a result, the existing interest rate is regarded appropriate to support the economy at this time.”
Once the bulk of the country’s population has been properly vaccinated and constraints on economic activities have been eased, a higher OPR in 2022 is more likely, he said.
“We believe that vaccinating 80 percent of Malaysia’s population by the end of the year is feasible.” It is reasonable to assume a complete reopening of the social and economic spheres once this goal is achieved. “We anticipate that the economy’s recovery will be accompanied by a strong desire to consume,” Adam said.
The equity market was largely weaker last week, pulled down by the extension of movement control restrictions and the application of the enhanced movement control order (EMCO) for most of Selangor and 14 Kuala Lumpur areas.
Malaysia’s latest export report, which showed a 47.3 percent year-on-year (y-o-y) increase to RM92.31 billion in May 2021, failed to raise the market.
Prime Minister Tan Sri Muhyiddin Yassin unveiled the RM150 billion National People’s Well-Being and Economic Recovery Package (PEMULIH) on Monday, which includes a RM10 billion fiscal infusion to help the people.
The FBM KLCI dropped 26.33 points to 1,533.35 at the close of the week, down from 1,559.68 the week before.
The FBM Emas Index was down 173.49 points to 11,160.91, the FBMT 100 Index was down 171.68 points to 10,873.42, and the FBM Emas Shariah Index was down 209.65 points to 12,176.11 on the index board.
The FBM ACE fell 10.59 points to 7,211.21, while the FBM 70 fell 169.20 points to 14,450.33.
Financial Services Index down 152.26 points to 15,127.45, Industrial Products and Services Index fell 1.05 points to 186.93, and the Plantation Index dropped 106.58 points to 6,415.82.
The Energy Index down 64.10 points to 801.42, the Healthcare Index fell 99.62 points to 2,841.55, and the Technology Index increased 0.39 points to 79.34.
Weekly turnover fell to 26.86 billion units worth RM14.05 billion from the previous week’s 27.78 billion units worth RM14.25 billion.
Volume on the Main Market increased to 17.73 billion shares worth RM11.74 billion, up from 16.29 billion shares worth RM11.73 billion last week.
Warrant volume fell from 1.48 billion units for RM154.96 million to 857.61 million units worth RM84.5 million.
The Ace Market volume declined from 10 billion shares worth RM2.35 billion last week to 7.36 billion shares worth RM2.22 billion./n
