PETALING JAYA: The tariff pause by the United States on most of its trading partners except China has provided some form of relief for investors.
The FBM KLCI showed immediate signs of recovery on April 10, rising 4.47% to close at 1,463.13 points, adding around RM73bil back to total market capitalisation on the exchange.
The benchmark index briefly fell below the 1,400-point mark on April 9, reaching a 20-month low to close at 1,400.59.
However, tariff concerns have continued to weigh on sentiment, with profit-taking in early-day trading on April 11.
Moomoo Malaysia head of dealing Ken Low believes that macro volatility is the new baseline and investors need to recalibrate their expectations.
“More than just merely a one-off shock, the recent events signal towards a part of a new global playbook. Macro volatility, especially driven by politics, is becoming structural,” he said.
He added that the flight to quality is a strategic move on the back of high uncertainties, as investors reallocated their funds into US treasuries, gold, defensive consumer names and high-dividend stocks.
Low advised investors to “take a thoughtful, strategic approach to managing their portfolios as markets undergo significant fluctuations due to tariff announcements and reversals.
“Increased volatility tied to policy signals – not fundamentals – requires investors to think in terms of flexible scenario planning. Allocations should reflect a spectrum of outcomes, including trade escalation, policy reversals and possible stimulus responses.
“It’s not just about forecasting the next move, but more about being positioned to rotate as the market reprices new narratives,” he said.
He added that liquidity is no longer just a buffer but a tactical advantage amid high-velocity moves.
“In this kind of market, investors should look for situations where the potential upside meaningfully outweighs the downside. That includes companies with strong fundamentals and unique drivers, which can perform well even if broader markets stay volatile.
“It also makes sense to use some protection strategies to guard against sharp sell-offs. Over the medium term, we see value in sectors that benefit from longer-term shifts, such as companies tied to supply chain realignment, manufacturing relocation, or regional trade growth.
“Regardless of short-term noise, these themes are gaining momentum,” Low said.
Meanwhile, BIMB Securities Research advised investors to use volatility to their advantage by deploying a dollar-cost averaging strategy as trying to time the bottom is impossible.
It pointed out investors should first look at stocks that have plunged toward their 52-week lows while expanding their positions in undervalued stocks.
The research house also told investors to cut losses by selling “lower-quality” stocks and increase exposure on quality names.
“We’re all value investors now – not by choice, but by necessity. So keep your nerves when others lose theirs. Ignore the hysteria, mute the noise, and what you’re left with is an extraordinary opportunity to buy high-quality businesses at bargain-basement prices.
“Cool heads. Long views. That is how wealth is built in markets like these,” it said.
