KUALA LUMPUR: The outlook for Malaysia's economy remains positive for this year, as such, CGS International Securities Malaysia Sdn Bhd has set an end-2026 KLCI target of 1,810, supported by a strengthening ringgit and encouraging policy impacts.
Its chief executive officer, Khairi Shahrin Arief Baki said the stronger ringgit has improved gross margins for corporates exposed to imported content and lowered interest costs for those with foreign borrowings, while boosting consumer sentiment at the same time.
"Trade tensions have eased, and with greater certainty comes greater willingness to invest, which should benefit both corporates and consumers.
"Our research team projects an 8.5 per cent increase in earnings for companies under our coverage and an end-2026 KLCI target of 1,810," he said during the opening of CGS International 18th Annual Malaysia Corporate Day 2026 today.
Commenting further, Khairi Shahrin said CGS International expects the earnings of listed companies to increase this year, based on the current positive performance in various sectors.
He said 85 per cent of companies under its coverage are highly domestic-focused and would benefit from a stronger ringgit, which would lower operating costs and support their performance.
"We also look at how the government has not just put in policies, but also made an effort in bringing business into Malaysia, which helps to boost the economy and employment," he added.
Meanwhile, CGS International's head of research, Prem Jearajasingam expects the ringgit to continue strengthening to 4.00 against the US dollar in the near term, before retreating to about 4.10 amid market volatility.
"There is still volatility in the currency market -- the ringgit went to 4.03 and now we are seeing it at about 4.07 versus the greenback.
"Some of the shorter moves are tough to predict, so we work on an average rather than trying to pick one rate at one point of time," he said. - Bernama
