The Malaysian stock market has been oscillating between gains and losses over the past four trading days, following a three-day winning streak where it saw an uptick of nearly a dozen points or 0.7%. The Kuala Lumpur Composite Index (KLCI) is currently positioned just above the 1,630-mark but is expected to decline again on Thursday.
The general outlook for the Asian markets indicates consolidation, particularly within the technology and semiconductor sectors. This forecast aligns with the prevailing trends observed in European and U.S. markets, which were predominantly lower, suggesting a similar trajectory for the Asian bourses.
On Wednesday, the KLCI recorded a modest gain driven by positive performances in the telecommunications and plantation sectors, while the financial sector displayed mixed results. Specifically, the index increased by 7.58 points, or 0.47%, to close at 1,633.54, after fluctuating between 1,629.89 and 1,638.03 throughout the day.
Key performers included Celcomdigi, which surged by 2.78%, and IOI Corporation, which accelerated by 2.43%. Additionally, Kuala Lumpur Kepong spiked by 2.50%, Maxis rose by 1.73%, and MRDIY saw a remarkable increase of 3.38%. On the downside, CIMB Group slightly decreased by 0.14%, and Maybank fell by 0.20%. Other notable movements involved Genting, which advanced by 1.05%, and Petronas Chemicals, which climbed by 1.17%. Several entities like Axiata, AMMB Holdings, Dialog Group, Petronas Dagangan, and IHH Healthcare remained unchanged.
In the U.S., Wall Street exhibited divergent trends as the Dow Jones Industrial Average hit a new record high, climbing 243.60 points or 0.59% to end at 41,198.08. Meanwhile, the NASDAQ and S&P 500 indices faced significant declines, with the NASDAQ plunging by 512.42 points or 2.77% to close at 17,996.92, and the S&P 500 falling by 78.93 points or 1.39% to settle at 5,588.27. The drop was largely attributed to a slump in semiconductor stocks following news that President Joe Biden’s administration might impose stricter trade regulations on companies involved in the semiconductor sector in China.
Moreover, market sentiment was dampened by former President Donald Trump's assertion that Taiwan should compensate the U.S. for defense services, claiming the country had monopolized America's semiconductor business.
In economic news, the Commerce Department reported a significant rebound in new residential constructions and building permits in the U.S. for June. Furthermore, a report from the Federal Reserve indicated that industrial production in the U.S. had surpassed expectations for the last month.
Oil prices witnessed a sharp uptick on Wednesday, spurred by an unexpected, substantial decrease in U.S. crude inventories and the effects of a weaker dollar. Consequently, West Texas Intermediate Crude oil futures for August surged by $2.09 or 2.6%, reaching $82.85 per barrel.
Looking ahead, Malaysia is set to release June data for imports, exports, and trade balance later today. Projections suggest a 15.5% annual increase in imports, up from the previous month's 13.8%. Exports are expected to grow by 4.6% year-on-year, a slight drop from the 7.3% rise reported in the previous month. The trade surplus is anticipated to widen to 14.80 billion ringgit, compared to 10.10 billion ringgit in May.
