PETALING JAYA: Bursa Malaysia Bhd
is projected to face a more subdued second half of 2026 (2H26) due to softer equity trading activity, CIMB Research says.
The research firm expects average daily value to slow to RM2.65bil, down from RM3.5bil in the second quarter (2Q26), based on equity market trading data.
Ahead of Bursa Malaysia’s upcoming 2Q26 results, it predicted a quarterly net profit of RM76.7mil from combined equity and derivatives trading.
“Despite continued foreign outflows during much of 2Q26, Bursa Malaysia’s trading activity remained supported by heightened portfolio repositioning amid an uncertain macro backdrop,” it said.
“Rather than a sustained ‘risk-on’ environment, trading sentiment was characterised by frequent shifts between risk-on and risk-off positioning as investors navigated evolving developments surrounding global trade policies, US monetary policy expectations, currency movements and domestic political uncertainties.”
It added that derivatives contracts traded in 2Q26 increased by 15% year-on-year (y-o-y) and 1.6% quarter-on-quarter (q-o-q), supported by 15.7% y-o-y growth in crude palm oil futures contracts.
Additionally, FBM FKLI volumes were higher by 11.9% y-o-y and 1.9% q-o-q.
Beyond 2Q26, CIMB Research cut its earnings forecasts for financial year 2026 (FY26), FY27 and FY28 by 3.8%, 5.9% and 6.3%, respectively.
It said this was largely to factor in a projected lower effective clearing fee in FY26-FY28 of 2.3 basis points (bps), compared to 2.4 bps previously, due to expected higher institutional participation of 71%-72% versus lower retail participation of 28%-29%.
The research house also revised its derivatives trading average daily contract projections to 96,900-105,100, from 96,500-101,300 previously, to better reflect current trading volumes.
Its “other operating expenses” assumption was raised by approximately 10% to 15% to reflect increases in information technology maintenance expenses and administrative expenses.
While earnings for FY26 are expected to grow by 11.8% y-o-y, it noted that the growth is likely to moderate to 1% and 2.5% y-o-y in FY27 and FY28, respectively, indicating a more sustainable medium‑term outlook.
“In our view, market expectations have yet to fully adjust to the weaker risk-reward profile in 2H26, which may cap Bursa Malaysia’s near-term share price upside.”
Nevertheless, CIMB Research said the recent landmark memorandum of understanding (MoU) between the Securities Commission and Hong Kong’s Securities and Futures Commission is a long-term positive for Bursa Malaysia and the country’s capital markets.
“While near-term earnings impact is likely limited, we view the MoU as a meaningful long-term structural catalyst that strengthens Bursa Malaysia’s growth prospects and supports the case for a longer-term re-rating.”
The new framework, aimed at enhancing capital market connectivity and collaboration, establishes the regulatory infrastructure required to enable broader investment opportunities and drive greater cross-border participation, it said.
The research house maintained its “hold” call on Bursa Malaysia, despite lowering its target price to RM8.65 from RM9 previously to reflect the downward revisions to its FY26-FY28 earnings forecasts.
“We continue to foresee lingering risk aversion amid lacklustre trading sentiment ahead of the general election,” it said.
