MIDF Amanah Investment Bank Bhd expects the positive momentum of the Bursa Malaysia market to continue in the fourth quarter of 2024, driven by foreign investment and supported by a healthy economy and encouraging corporate earnings prospects.
He also said that the benchmark FBM KLCI showed a more stable increase compared to its fellow countries in Asean when it recorded an increase of 15% from the beginning of the year to 25 September.
In the second quarter, the FBM KLCI started well where it did not experience any slowdown.
The local shares benefited from the positive change in sentiment. It posted an impressive quarter-on-quarter increase of 5.2% in the third quarter.
Given the liquidity outlook and still positive fundamentals, MIDF maintains the FBM KLCI, FBM Hijrah and FBM70 targets for 2024 at 1,750 points, 14,100 points and 18,900 points.
They also expect Malaysia's Gross Domestic Product (GDP) growth this year to be higher at 5.0% and it will decrease slightly to 4.6% in 2025.
The recent US FOMC meeting hinted at more interest rate cuts later this year after an initial cut of 50 basis points in September.
The interest rate futures market expects two more rate cuts this year totaling an additional 75 basis points as well as several rate cuts in 2025.
Meanwhile, Bank Negara Malaysia (BNM) is expected to keep the Overnight Policy Rate (OPR) unchanged in 2024 and 2025.
The difference in interest rates between the ringgit and the US dollar is expected to continue to decrease until next year.
