Bursa Malaysia likely to tread on cautious note next week

KUALA LUMPUR: Bursa Malaysia is likely to trade on a cautious tone next week as investors are looking at the release of economic data including Malaysia’s first-quarter gross domestic product (GDP) next week.

AxiTrade chief global market strategist Stephen Innes said the market is pricing in complacency around the United State-China trade talks as there is still a level of caution until US President Donald Trump gives the all-clear that some level of traffic won't be reinstated on China.

This is while the blame game on the origin of COVID-19 virus looked likely to carry on for some time, he added

"It is going to be a bumpy path but things should improve throughout the second quarter of 2020, but I am tempering expectation for next week due to the release of Malaysia gross domestic product (GDP), which is bound to be gnarly,” he told Bernama.

Bank Negara Malaysia is expected to release the country’s first-quarter GDP on May 13.

Meanwhile, the market would also monitor the release of US non-farm payrolls on Friday night after the US economy reported the loss of a staggering 20.5 million jobs in April, the steepest plunge in payrolls since the Great Depression.

Throughout the week just ended, Bursa Malaysia experienced rangebound trading due to the release of some economic figures including a weak manufacturing data and a steep overnight policy rate by Bank Negara Malaysia.

On Monday, IHS Markit Malaysia Manufacturing Purchasing Managers’ Index fell sharply to 31.3 in April 2020 from 48.4 in March 2020, as the manufacturing sector came under heavy pressure due to measures implemented to tackle the COVID-19 pandemic.

The central bank has lowered its Overnight Policy Rate (OPR) by 50 basis points to 2.00 per cent on Tuesday, the lowest OPR level in 10 years. The last time OPR stood at 2.0 per cent level was in February 2010.

Bursa Malaysia was closed on Thursday in conjunction with Wesak Day and will be closed on Monday for the extended Nuzul Al-Quran public holiday.

On a Friday-to-Friday basis, key index FTSE Bursa Malaysia KLCI (FBM KLCI) fell 24.97 points, to end at 1,382.81.

On the scoreboard, the FBM Emas Index trimmed 72.67 points to 9,735.91, the FBMT 100 Index slipped 90.70 points to 9,586.51, and the FBM Emas Shariah Index fell 43.69 points to 10,846.45.

The FBM 70 climbed 239.44 points to 11,899.67, and the FBM ACE Index surged 226.31 points to 5,021.41.

Sector-wise, the Financial Services Index decreased 187.64 points to 12,285.27, the Industrial Products and Services Index gained 0.20 of-a-point to 120.64 and the Plantation Index shrank 121.35 points to 6,239.67.

In the holiday-shortened week, weekly turnover increased to 21.80 billion units worth RM10.71 billion from 20.88 billion units worth RM10.54 billion last Friday.

Main Market volume rose to 14.48 billion shares worth RM9.20 billion shares from 13.19 billion shares worth RM8.81 billion last week.

Warrants turnover jumped to 1.32 billion units worth RM250.62 million from last Friday’s 995.99 million units worth RM2.30 billion.

The ACE Market volume eased to 6.0 billion shares worth RM1.27 billion from 6.36 billion shares worth RM1.49 billion. - Bernama
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