Bursa Malaysia erased early gains to end lower on February 4 amid profit-taking and cautious sentiment, influenced by a Wall Street pullback in tech stocks and ahead of US Fed decisions. The FTSE Bursa Malaysia KLCI (KLCI) fell 5.44 points or 0.31% to close at 1,742.82 from the previous close of 1,748.26. The index opened 1.84 points lower at 1,746.42, climbed to a high of 1,751.22, but dipped to a low of 1,740.50 before settling. Trading volume was moderate, with decliners outpacing gainers, reflecting a mixed but cautious market breadth.
Movers and Shakers
The KLCI’s decline was driven by selling in heavyweights, particularly telcos and energy, amid profit-taking after recent highs. However, plantations and select financials provided some support. Notable top gainers included:
- United Plantations (UTDPLT): Up 12 sen to RM29.30 on palm oil stability.
- GuocoLand (Malaysia): Rose 10.5 sen to RM1.04 amid property rebound.
- Malayan Cement: Gained 10 sen to RM8.35 in construction plays.
- Alliance Bank Malaysia: Added 6 sen to RM5.31 on banking resilience.
- Sunway Construction Group: Increased 6 sen to RM5.31, tied to infrastructure demand.
Top losers targeted energy and telcos:
- Petronas Gas: Down 24 sen to RM18.30 amid commodity swings.
- Petronas Dagangan: Fell 8 sen to RM20.24.
- UWC: Slipped 7 sen to RM4.33.
- MNRB Holdings and PPB Group: Down 6 sen each to RM2.40 and RM11.04.
High-volume actives included Pharmaniaga (+0.5 sen to 33 sen) and MLABS (-1.5 sen to 3 sen). Analysts maintain a positive outlook, targeting 1,810 by end-2026 on resilient growth.
Policy Changes Impacting KLCI and Malaysia’s Market
Domestically, the 13th Malaysia Plan (13MP) focuses on digitalisation, high-value industries, and sustainability, with Budget 2026 emphasizing SST expansion, e-invoicing, and carbon tax for fiscal discipline. The New Incentive Framework launches March 1, 2026, for manufacturing, tying incentives to outcomes like tax rates or allowances. GEAR-uP targets RM120 billion investments by 2028, supporting 4.3-4.5% GDP growth. OPR holds at 2.75%, aiding stability.
Globally, US tariffs (19% on Malaysia) risk softening exports, but exemptions for 60% of exports (e.g., semiconductors at 40%) and the October 2025 US-Malaysia deal mitigate impacts. IMF warns of AI hype and geopolitics, with inflation at 3.8%. Fed’s potential pause adds caution.
Other News Potentially Impacting KLCI or Malaysia’s Market
- Ringgit Strength: Hit a five-year high below RM4/USD, boosting inflows and sentiment.
- Manufacturing PMI: Reached a 20-month high of 50.2 in January 2026, signaling expansion.
- Producer Prices: Fell 2.7% in December 2025, indicating low inflation.
- Export Outlook: Moderates in 2026 due to tariffs, but E&E and tourism (Visit Malaysia 2026) drive resilience.
- Sector Themes: AI/data centers reinforce Malaysia as “China+1” hub; renewables M&A grows.
- Broader Risks: Geopolitical tensions (US-Iran) and Fed pauses add uncertainty, but reforms provide buffers.
The KLCI remains resilient in early 2026, with domestic drivers offsetting global headwinds.