Bursa Malaysia Records Best Monthly Performance of 2026

KUALA LUMPUR, AUGUST 2026 – Bursa Malaysia recorded its best monthly performance of 2026 after the benchmark FTSE Bursa Malaysia KLCI climbed 3.66% to close July at 1,725 points.

The gain helped the index recover from a 1.13% decline recorded in June and reflected improving investor confidence in Malaysia’s domestic economic outlook.

CIMB Securities said the stronger market momentum was supported by resilient economic fundamentals, the return of foreign investors as net buyers and an encouraging start to the second-quarter corporate earnings season.

The research firm noted that these positive factors helped the local market withstand continued uncertainty in global financial markets.

Investor sentiment was further strengthened by Malaysia’s preliminary gross domestic product growth of 5.8% year-on-year in the second quarter of 2026, which exceeded market expectations.

The stronger-than-anticipated expansion reinforced confidence that the domestic economy remained resilient despite external trade and geopolitical pressures.

Easing inflation also supported the market outlook, while Bank Negara Malaysia’s decision to maintain the Overnight Policy Rate at 2.75% provided greater clarity on borrowing costs and monetary conditions.

The combination of stable interest rates and moderating price pressures helped improve expectations for consumer spending, investment and corporate earnings.

Nevertheless, international markets continued to face several major risks during July.

These included the reinstatement of United States Section 301 tariffs, investigations into industrial overcapacity, geopolitical tensions in West Asia and concerns surrounding the sustainability of spending linked to artificial intelligence.

Middle East tensions also briefly pushed Brent crude oil above US$100 per barrel, adding uncertainty to global inflation and energy-market expectations.

Despite those challenges, CIMB Securities said Malaysia remained attractive to investors because of its resilient domestic growth, relatively appealing stock valuations and increasingly clear government policy direction.

The firm added that the second-quarter corporate earnings season had begun on an encouraging note.

Of the 19 companies that had released their financial results, 21% exceeded expectations, while 26% performed below forecasts. The remaining companies reported results broadly in line with market estimates.

Foreign investors returned as net buyers in July, recording net inflows of RM267 million after withdrawing RM6.1 billion during May and June.

Foreign buying was concentrated mainly in the financial services, transportation and utilities sectors.

Local institutional investors, however, became net sellers with outflows of RM406 million after acting as net buyers for two consecutive months.

Local retail investors remained net buyers for the third straight month, although their purchases declined sharply to RM19 million from RM453 million in June.

Proprietary investors also returned as net buyers, with inflows of RM120 million driven mainly by purchases in financial and industrial stocks.

Regionally, the FBM KLCI ranked as the third-best performing index among the MIST markets in July, gaining about 3.7%.

Malaysia trailed Indonesia, which rose 10.5%, and Singapore, which advanced 8.9%, but outperformed Thailand, where the benchmark market declined 7.9%.

Plantation, industrial and financial stocks led the gains on Bursa Malaysia.

The plantation sector benefited partly from concerns surrounding the El Niño weather phenomenon, while industrial and financial counters were supported by geopolitical developments and strong domestic macroeconomic data.

Utilities, property stocks and real estate investment trusts performed more weakly due to profit-taking and concerns over the interest-rate outlook.

Among the FBM KLCI’s component stocks, Petronas Chemicals emerged as the strongest performer in July with an 18% increase.

CelcomDigi followed with a 12% gain, while SD Guthrie rose 10%.

Axiata, YTL Corporation and IOI Properties were among the companies that recorded the largest declines during the month.