CGS-CIMB reiterates KLCI end-2022 target at 1,612

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KUALA LUMPUR: CGS-CIMB Securities Sdn Bhd has reiterated that the FTSE Bursa Malaysia KLCI (FBM KLCI) to finish 2022 at 1,612 and anticipated buyers to tread cautiously all year long.

It mentioned the cautious tone was in view of potential headwinds buffeting the markets within the type of new COVID-19 waves (Omicron), the return of intra-day short-selling, overseas fund outflows because of the US Federal Reserve tapering transfer, and reversals of fiscal stimulus.

It was additionally because of the expectation of tighter financial coverage, company earnings dangers as a result of increased taxes, flood state of affairs, and political dangers with the likelihood of the fifteenth General Election being held in 2022 stays excessive, it mentioned.

“However, draw back may very well be capped by expectations of stronger financial development as Malaysia reopens worldwide borders since Oct 11, together with extra liquidity out there for home institutional funds just like the Employees Provident Fund following the top of the assorted one-off withdrawal schemes below stimulus packages introduced in 2020 and 2021.

“(Also) on condition that the KLCI is buying and selling at undemanding valuations, we reiterate our end-2022f KLCI target of 1,612 factors” it mentioned.

For January 2022, CGS-CIMB expects extra sideways actions as the important thing index continues on its base-building part.

It mentioned buyers’ consideration could be on the primary Monetary Policy Committee (MPC) of Bank Negara Malaysia for the yr on Jan 19-20, in addition to the primary US Federal Open Market Committee (FOMC) assembly for the brand new yr on Jan 25-26.

“Market watchers may also be on the look out for information flows on ongoing floods in Malaysia and its potential impression on the financial system,” it mentioned. – Bernama



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