KLCI Update: July 3, 2025 – Profit-Taking Ends Winning Streak Amid Policy Shifts
The Kuala Lumpur Composite Index (KLCI) saw its recent five-day winning streak end on Thursday, July 3, 2025. Profit-taking activities weighed on the market. The benchmark index slipped 0.08% (1.22 points) to close at 1,548.99. Despite this slight dip, the broader market showed resilience. 630 stocks rose while 389 declined, indicating widespread buying interest. Total traded volume surged to 5.09 billion shares, valued at RM2.94 billion. Furthermore, the FBM 70 index, tracking mid-cap stocks, rose. This suggests an active rotation into second-liner equities.
Key Market Indicators (as of July 3, 2025)
- FBM KLCI:
- Close (Index): 1,548.99
- One-day change: -0.08
- YTD change: -5.68
- FBM Mid 70:
- Close (Index): 16,632.78
- One-day change: 0.75
- YTD change: -10.01
- FBM Small Cap:
- Close (Index): 15,286.02
- One-day change: 1.09
- YTD change: -15.84
Movers and Shakers on Bursa Malaysia
Among FBM KLCI constituents, Nestlé (Malaysia) Bhd was a notable mover, experiencing a significant one-day change of 3.73%. Conversely, companies like Tenaga Nasional Bhd saw declines, which weighed down the index.
Borneo Oil Bhd was one of the most active counters by volume, reflecting strong trading interest.
By value, Nestlé (Malaysia) Bhd also led the gainers, with a one-day change of RM79.8 million. This indicates substantial gains for investors.
However, Tenaga Nasional Bhd was a significant loser by value, with a one-day change of -RM3.97 million.
Policy Changes Impacting KLCI
Malaysian Domestic Policies: The Unity Government continues its push for meaningful structural reforms. A significant development is the implementation of SST3.0 in July 2025. This broadens the sales and service tax base. It could potentially add RM10 billion to annual revenues. This effort, alongside ongoing RON95 fuel subsidy rationalization, aims to improve national finances. The subsidy cuts could save RM8 billion annually. These fiscal consolidation efforts are part of the broader Ekonomi MADANI framework. This framework guides sustainable and inclusive economic growth. Moreover, the FTSE Bursa Malaysia KLCI semi-annual review, with constituent changes effective June 23, 2025, directly influences the index’s composition and performance.
Global Economic Policies: The global economic landscape remains a crucial factor. Trade policy uncertainty and new tariff hikes (e.g., US tariffs) are weakening global growth prospects. For instance, the OECD projects a slowdown to 2.9% in 2025 and 2026. While Malaysia was affected by a 24% tariff rate, it fared better than the ASEAN average. Additionally, divergence in global central bank monetary policies has significantly impacted currency markets. The US Federal Reserve held rates steady, the European Central Bank (ECB) cut rates, and the Bank of Japan (BoJ) maintained its policy rate. Hopes for US Federal Reserve rate cuts in the second half of 2025 offer some support to markets. Nevertheless, global equity markets remain volatile amidst these uncertainties.