Bursa Malaysia rebounded on March 3, ending a three-session losing streak as investors engaged in bargain-hunting following the previous day’s sharp decline amid Middle East tensions. The FTSE Bursa Malaysia KLCI (KLCI) rose 11.74 points or 0.69% to close at 1,711.95 from the previous close of 1,700.21. The index opened 4.02 points higher at 1,704.23 and traded between 1,704.23 and 1,715.93 during the session. At midday, it was up 14.36 points or 0.84% at 1,714.57. Trading volume was moderate, with gainers outpacing decliners, reflecting improved sentiment amid a firmer ringgit and tariff relief. This marks a partial recovery from the geopolitical-driven sell-off, with the market showing resilience.
Movers and Shakers
The KLCI’s rebound was driven by bargain-hunting in blue-chips, particularly in banking, industrials, and construction sectors, offsetting broader caution. Notable top gainers included:
- Public Bank Bhd: Up on resilient demand.
- CIMB Group Holdings Bhd: Rose amid banking strength.
- Gamuda Bhd: Gained on infrastructure projects.
- Sunway Bhd: Added in construction plays.
- Press Metal Aluminium Holdings Bhd: Increased on commodity stability.
Top losers were limited, with some pressure in consumer and tech amid global volatility. High-volume actives featured cyclicals. Analysts maintain a year-end target of 1,772-1,880 points, supported by reforms and earnings growth.
Policy Changes Impacting KLCI and Malaysia’s Market
Domestically, 2026 is the “year of implementation” under the Madani government, shifting focus to delivery of fiscal reforms like subsidy rationalisation and tighter spending. The 13MP emphasizes digitalisation, high-value industries, and sustainability, with Budget 2026 including SST expansion, e-invoicing, electricity tariffs, dividend taxation, and carbon tax to broaden revenue and support ESG goals. The New Incentive Framework launches March 1, 2026, tying manufacturing incentives to outcomes like tax rates or allowances. GEAR-uP targets RM120 billion investments by 2028, aiding 4.3-4.5% GDP growth. OPR holds at 2.75%, with core inflation stable at long-term average. E-waste import ban effective February 2026 disrupts battery recycling. RON95 subsidy savings projected at RM2.5 billion in 2026.
Globally, US tariffs at 19% on Malaysia pose risks, but exemptions insulate 60% of exports (semiconductors 40%) via the October 2025 US-Malaysia deal. IMF warns of AI hype, geopolitics (US-Iran), and inflation at 3.8%. Fed’s potential pause adds caution, but alliances cushion impacts. Global investors bet on Malaysia as a “rising star” amid diversification from US dollar weakness.
Other News Potentially Impacting KLCI or Malaysia’s Market
- Q4 2025 GDP: Expanded at fastest pace in over a year, supported by domestic demand; full data imminent.
- Ringgit Rally: Hits 5-8 year high below RM4/USD, boosting inflows and sentiment.
- Manufacturing PMI: At 20-month high of 50.2 in January 2026, signaling expansion.
- Producer Prices: Fell 2.7% in December 2025, indicating low inflation.
- Export Outlook: 2025 boom cools in 2026 amid tariffs, but E&E, AI, and Visit Malaysia 2026 provide support; risks from sectoral tariffs.
- Sector Themes: AI/data centers reinforce Malaysia as “China+1” hub; renewables M&A grows; sukuk issuance high; industrial leads property market.
- Broader Risks: Geopolitical tensions (US-Iran), Fed pauses, trade frictions, AI hype; but reforms and alliances buffer.
The KLCI shows resilience in early 2026. Reforms drive growth, though global volatility persists.