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KUALA LUMPUR: The benchmark FBM KLCI may hit 1,900 points by end of 2018 after the 14th General Election (GE14), driven by strong corporate earnings and the ringgit against the greenback, said MIDF Research.
Head of equity strategy Syed Muhammed Kifni Syed Kamaruddin said that the FBM KLCI had been trading sideways since the beginning of the year as investors were cautious on the GE14.
“The market has been under selling pressure in the last few months because of election uncertainties,” he told reporters at a briefing on Monday.
He pointed out that the market is expected to end the year at 1,750 points, but would rebound next year to 1,900 points especially after GE14.
“We expect the market to pick up and move in tandem with corporate earnings performance.
“If you recall, the Monday after GE13, on May 5, 2013, the FBM KLCI gained more than 100 points,” Muhammed Kifni said.
He, however, noted that the market should be aware of the three potential interest rate hike by the US Federal Reserve next year, which would “create some noise”.
“But eventually, price will catch up with earnings growth momentum,” he said.
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