KUALA LUMPUR, Sept 4 — Trading activity on Bursa Malaysia is expected to be cautious next week as investors will be closely watching domestic and global economic developments, with the FTSE Bursa Malaysia KLCI (FBM KLCI) expected to be between 1,585 and 1,605 points.

Bank Islam Malaysia Bhd economist Adam Mohamed Rahim told Bernama the highlight of next week would be Bank Negara Malaysia’s monetary policy committee meeting on Thursday whereby the overnight policy rate (OPR) is likely to be kept unchanged at 1.75 per cent.

"The latest round of relaxation of restrictions for social and economic sectors for fully vaccinated individuals is likely to support economic growth in the coming months, combined with earlier fiscal stimulus measures provided by the government.

"Assuming that the OPR is maintained at 1.75 per cent, then counters such as banks which are heavyweights of the FBM KLCI will remain status quo and therefore will not cause any huge movement in the index,” he said.

Nevertheless, Adam said further upside may be provided if investors continue the thematic play of economic recovery especially after Melaka moves into Phase 2 of the National Recovery Plan while Negri Sembilan transitions into Phase 3.

Apart from that, he said Malaysia’s Industrial Production Index for the month of July will be released next Friday and the index may record a slower growth due to the enhanced movement control order imposed in certain localities in Kuala Lumpur and Selangor during the first half of July leading to the closure of some factories.

Adam said the local index closed at 1589.19 points on Friday while it’s regional peers appeared mixed as investors awaited the US payrolls data to further assess the timing of the US Federal Reserve’s plan to begin tapering.

"Maxis Bhd led gainers among FBM KLCI members after advancing 3.3 per cent during the day while Top Glove was the biggest loser, declining 3.1 per cent. Among sectoral indexes, the Bursa Malaysia Transportation and Logistics Index led gainers on Friday after ending 1.5 per cent higher.

"The gain in the Bursa Malaysia Transportation and Logistics Index was sparked by the government’s decision to activate the Langkawi travel bubble from Sept 16,” he added.

On a Friday-to-Friday basis, the benchmark index eased 0.97 of-a-point to end the week at 1,589.19 from 1,590.16 previously.

On the index board, the FBM Emas Index was 34.45 points stronger at 11,594.98, the FBMT 100 Index climbed 19.61 points to 11,292.99, and the FBM Emas Shariah Index strengthened 15.39 points to 12,694.75.

The FBM ACE gained 36.91 points to 7,251.78 and the FBM 70 jumped 129.91 points to 15,100.25.

Sector-wise, the Plantation Index shed 73.69 points to 6,699.99, the Financial Services Index perked 49.87 points to 15,536.77 and the Industrial Products and Services Index edged up 3.36 points to 199.92.

The Healthcare Index added 13.47 points to 2,798.56, the Energy Index eased 0.70 of-a-point to 770.94 and the Technology Index went down 0.49 of-a-point to 90.11.  

During the shorter trading week, weekly turnover decreased to 17.65 billion units valued at RM12.71 billion from 21.78 billion units valued at RM14.41 billion in the previous week.

The Main Market volume, however, widened to 12.24 billion shares worth RM11.38 billion from last week’s 10.72 billion shares worth RM12.56 billion.

Warrants volume was lower at 1.31 billion units valued at RM182.24 million against 1.76 billion units valued at RM250.17 million previously.

The ACE Market volume slipped to 4.09 billion shares worth RM1.14 billion from 6.68 billion shares worth RM1.59 billion last week. — Bernama