KUALA LUMPUR, June 7 — Foreign investors continued to remain as net sellers this week, as total net outflow rose to RM996.22 million from RM589.62 million last week.

An analyst said the markets are expected to show some positive signs persisting into next week, prompted by the National Economic Recovery Plan (Penjana) initiatives announced by Prime Minister Tan Sri Muhyiddin Yassin on Friday.

Bank Islam Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) continued to stage a favourable trend during the week, largely due to the improvement in the banking stocks.

“The FBMKLCI rose 83.08 points week-on-week to close at 1,556.33 points on Friday. Local institutions recorded a net buy of RM1.09 billion between June 1 and 4, while Local Retail registered net sales of RM97.71 million during the same period.

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“There could be some correction next week. The FBMKLCI is currently trading at 20 times price to earnings (PE), which is higher than its plus-one standard deviation PE of 17 times. In that sense, the valuation is quite stretch,” he told Bernama.

Tan Sri Muhyiddin Yassin announced 40 initiatives worth RM35 billion under Penjana, whereby the bulk of the allocation were crafted towards job security, including those in the gig economy, re-skilling and easing cash flow for businesses.

The Prime Minister said the government identified three core thrusts under Penjana, namely empowering the people, propelling businesses and stimulating the economy.

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Among others, the government will facilitate policies to support the growth of the gig economy and welfare of workers in this sector.

The feel good factor from Penjana initiatives could be felt in several industries, particularly in the property and automotive sectors, that would benefit from them, Afzanizam said, adding that there would be some interests in these industries next week.

Addtionally, he said the better-than-expected the US Nonfarm Payroll (NFP), with 2.5 million jobs added to the economy and the unemployment rate dropped to 13.3 per cent in May, would solidify the case of a gradual economic recovery.

“The resistance level currently stands at 1,580 points while the support level at 1,530 points. We think the FBMKLCI would linger around this level next week,” he added.

The local equity market will be closed on Monday in conjunction with the official birthday of the Yang di-Pertuan Agong. — Bernama