The Kuala Lumpur Composite Index endured its steepest drop since last August, ending 2.3% lower at 1,484.83, amid escalating global trade fears.
Currently in a technical correction, the index has shed 11.5% from its high of 1,678 points recorded in August 2024, and has declined by 9.3% this year.
According to Thong Pak Leng, Vice President of Equity Research at Rakuten Trade, this downturn reflects an immediate reaction to U.S. trade proclamations under President Trump, intensifying investor doubt. Despite the dip, Thong anticipates a near-term rebound as he views the index as currently oversold, predicting it will hover between 1,480 and 1,510 throughout the week.
Meanwhile, Mohd Sedek Jantan, Head of Investment Research at UOB Kay Hian Wealth Advisors, notes that the sharp sell-off in U.S. equities, especially tech sectors dragging the S&P 500 and Nasdaq Composite to lows not seen in six months, exacerbates pressure on emerging markets, including Malaysia. Jantan warns that without decisive policy measures to entice sustained foreign investment, Malaysia’s financial markets may remain susceptible to further downturns.
