KUALA LUMPUR, July 3 — Bursa Malaysia is expected to trade in a tight range of between 1,530 points and 1,540 points next week.

Bank Islam Malaysia Bhd economist Adam Mohamed Rahim said besides COVID-19 developments, investors will closely monitor the next Monetary Policy Committee (MPC) on the Overnight Policy Rate (OPR), scheduled to be held on July 8.

"Bank Negara Malaysia (BNM) is likely to stay put with the current OPR of 1.75 per cent.

"A rate hike in 2021 is premature,” he told Bernama, noting that the country is still in the midst of recovery with current coronavirus cases staying above 5,000 per day.

"So the current interest rate is deemed appropriate at this juncture to support the economy.”

A higher OPR in 2022 would be more plausible once the majority of the country’s population is fully vaccinated and restrictions for economic activities eased, he said.

"We reckon that the aim to vaccinate 80 per cent of Malaysia’s population by year-end is possible. Once this goal is reached, a full reopening of the social and economic sectors is something that can be reasonably expected. We (reckon) that the reopening of the economy will be accompanied by a strong propensity to consume,” Adam said.

During the week just ended, the equity market was mostly lower, dragged down by the extension of the movement control restrictions and the imposition of the Enhanced Movement Control Order (EMCO) for most parts of Selangor and 14 localities in Kuala Lumpur.

Malaysia’s latest exports data for May 2021, which surged by 47.3 per cent year-on-year to RM92.31 billion, failed to lift the market.

On Monday, Prime Minister Tan Sri Muhyiddin Yassin announced the National People’s Well-Being and Economic Recovery Package (PEMULIH) worth RM150 billion, including a RM10 billion fiscal injection to support the people.

The FBM KLCI fell 26.33 points to end the week at 1,533.35 from 1,559.68 a week earlier.

On the index board, the FBM Emas Index was 173.49 points lower at 11,160.91, the FBMT 100 Index decreased 171.68 points to 10,873.42 and the FBM Emas Shariah Index fell 209.65 points to 12,176.11.

The FBM ACE dropped 10.59 points to 7,211.21, and the FBM 70 erased 169.20 points to 14,450.33.

Sector-wise, the Financial Services Index gave up 152.26 points to 15,127.45, the Industrial Products and Services Index slipped 1.05 points to 186.93, while the Plantation Index lost 106.58 points to 6,415.82.

The Energy Index trimmed 64.10 points to 801.42, the Healthcare Index contracted 99.62 points to 2,841.55 and the Technology Index gained 0.39 of-a-point to 79.34.

Weekly turnover declined to 26.86 billion units worth RM14.05 billion, from 27.78 billion units worth RM14.25 billion recorded in the previous week.

Main Market volume rose to 17.73 billion shares worth RM11.74 billion from last week’s 16.29 billion shares worth RM11.73 billion.

Warrants volume decreased to 857.61 million units worth RM84.50 million from 1.48 billion units worth RM154.96 million previously.

The Ace Market volume dropped to 7.36 billion shares worth RM2.22 billion from 10.0 billion shares worth RM2.35 billion last week. — Bernama