BNM's Move Could Inject Excitement In Lagging Banking Stocks
The Thursday's session saw the local bourse trade negatively, weighed down by Banking heavyweights — despite BNM keeping the overnight policy rate steady but flagging further downside risks amid uncertainties surrounding President Trump's
trade policies.
As for Wall Street, markets surged after President Trump announced a preliminary trade deal with the UK, reducing tariffs on cars and steel while expanding US exports on beef, ethanol, and machinery. The Dow rose over 250 points, with gains in Boeing and Deere.
The Day AheadUS: With progress toward de-escalation of the trade war—President Trump announced a trade deal with the UK, signalling a potential rollback of tariffs on Chinese goods, risk-on sentiment emerged on Wall Street and was traded higher. Also, the market appears optimistic ahead of next week's US-China meeting in Switzerland. In the US, META presents trading opportunities, supported by its +16% YoY topline growth which exceeded analysts' forecasts, while the recovery in users
and ads spending should support the share price going forward. In commodities, Brent crude oil edged higher toward USD63/bbl, while gold traded around USD3,316 zone. CPO prices hovered between RM3,800–3,900/MT.
In view of the positive performance in the US, Malacca Securities expects the local bourse to rebound as the Bursa Finance index has risen 8% since the April 9 low, further supported by the 100bps cut in the Statutory Reserve Requirement,—which injected approximately RM19bn in liquidity into the banking system. Traders may look for trading opportunities in lagging banking stocks such as Alliance and AmBank.
The house said it also noticed the AI theme has regained momentum following the potential revision of the Biden administration's chip restriction act. This could spur trading interest in the Construction, Utility, and Technology sectors. Related
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