Latest News on FTSE Bursa Malaysia KLCI (KLCI) – February 26, 2026

Bursa Malaysia closed lower on February 26, recovering from an intraday low but weighed down by profit-taking, particularly in financial stocks, amid mixed global markets. The FTSE Bursa Malaysia KLCI (KLCI) eased 6.87 points or 0.39% to close at 1,740.94 from Wednesday’s close of 1,747.81. The index opened lower, hit an intraday low, but rebounded somewhat before close. Trading volume rose to 2.98 billion units worth RM4.07 billion, with decliners outpacing gainers. This marks the second consecutive decline, though the index remains above its 12-month average with a 2.25% gain over the past year. KLCI futures ended mostly higher, with the February 2026 contract down 5 points to 1,741.0.

Movers and Shakers

The KLCI’s dip was led by profit-taking in banking and financial heavyweights, capping gains despite a rebound from intraday lows. Banking stocks were key drags on the index. Specific movers were not detailed in intraday reports, but broader trends show resilience in consumer and tech amid global volatility. Analysts forecast the KLCI to reach 1,511.87 points in 12 months, with near-term estimates at 1,631.33 for the quarter. Year-to-date return stands at 3.51%.

Policy Changes Impacting KLCI and Malaysia’s Market

Domestically, 2026 is the “year of implementation” under the Madani government, focusing on 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. The New Incentive Framework launches March 1, 2026, tying manufacturing incentives to outcomes. GEAR-uP targets RM120 billion investments by 2028, aiding 4.3-4.5% GDP growth. OPR holds at 2.75% with no changes expected unless shocks emerge. E-waste import ban effective February 2026 disrupts battery recycling but drives higher payables. RON95 subsidy savings projected at RM2.5 billion in 2026. Bank Negara fined KAF Investment RM1 million for forex rule breach.

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 and tensions.

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. IOI Properties explores REIT listings in Malaysia and Singapore worth up to $8 billion. Sunway plans to list healthcare division by Q1 2026.
• 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.