Bursa Malaysia Seen Trading Higher Next Week, FBM KLCI Targeted at 1,725–1,750

KUALA LUMPUR, AUGUST 2026 — Bursa Malaysia is expected to maintain a positive bias in the coming week, with analysts forecasting the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) to trade within a range of 1,725 to 1,750 points.

The outlook comes after the benchmark index ended the latest trading week at 1,736.48, up 9.09 points from 1,727.39 a week earlier. Despite the weekly improvement, market participants are expected to remain selective amid mixed domestic and external signals.

Rakuten Trade Sdn Bhd Head of Research Kenny Yee expects the Malaysian equity market to remain in a consolidation phase as investors weigh resilient corporate earnings against persistent selling by foreign investors.

While the earnings outlook remains supportive, continued net foreign fund outflows in recent weeks have restricted the potential for a stronger advance in the benchmark index.

Corporate results are expected to remain one of the key catalysts for the market as Malaysia moves through the peak earnings-reporting period.

Recent trading sessions have also shown that investors continue to favour selected blue-chip and fundamentally strong stocks rather than adopting a broad risk-on approach.

IPPFA Sdn Bhd Director of Investment Strategy and Country Economist Mohd Sedek Jantan expects the FBM KLCI to maintain its upward trajectory next week.

However, he cautioned that profit-taking could emerge if the index moves above the 1,740-point level, particularly following its recent advance.

The 1,740 level is therefore expected to become an important near-term test for the benchmark.

A sustained move beyond that level could depend on whether domestic earnings remain resilient and external financial conditions become more supportive.

Movements in global bond yields are expected to remain particularly important for Malaysian equities, especially banking stocks.

Mohd Sedek said the recent rise in the 10-year US Treasury yield has pushed global discount rates higher, putting pressure on bank valuations as investors reassess funding costs and net interest margin prospects.

Elevated US Treasury yields have already affected sentiment on Bursa Malaysia this week, particularly among technology and other growth-oriented counters that tend to be more sensitive to changes in interest-rate expectations.

A more sustainable recovery in Malaysian banking shares could therefore require greater stability in global bond yields, alongside healthy domestic earnings and stronger investment inflows.

Foreign investor activity will also remain a significant factor in determining whether Bursa Malaysia can extend its recent gains.

The Malaysian market has experienced continued foreign selling in recent weeks, creating a counterweight to improving corporate earnings and relatively resilient domestic economic fundamentals.

For example, Bursa Malaysia data showed foreign investors disposed of RM125 million worth of equities on Aug. 19, while local institutions and retail investors remained net buyers.

Persistent foreign selling could prevent the FBM KLCI from breaking significantly higher even if domestic earnings remain supportive.

Oil prices and geopolitical developments will also remain on investors’ radar.

Mohd Sedek identified Brent crude prices, US Treasury yields and foreign fund flows as among the factors likely to determine whether the market’s next upward phase can be sustained.

Oil prices have remained elevated amid geopolitical concerns in the Middle East. Brent crude was trading above US$90 per barrel during the week, adding uncertainty over global inflation and future interest-rate conditions.

For Malaysia, higher oil prices can support selected energy-related stocks, but prolonged increases could also raise inflation concerns and affect global monetary policy expectations.

On a Friday-to-Friday basis, the FBM KLCI climbed 9.09 points to 1,736.48, compared with 1,727.39 in the previous week.

Among the broader indices, the FBM Emas Index gained 16.84 points to 12,832.28, while the FBM Top 100 Index advanced 24.66 points to 12,650.92.

The FBM Emas Shariah Index increased 12.56 points to 12,641.79, while the FBM ACE Index rose 39.01 points to 5,333.79.

In contrast, the FBM Mid 70 Index declined 142.15 points to 18,151.04.

Sector performance was mixed during the week.

The Plantation Index jumped 113.25 points to 9,440.65, making it one of the stronger sectoral performers.

Meanwhile, the Financial Services Index declined 70.63 points to 20,440.65, while the Energy Index slipped 2.43 points to 777.03.

The Industrial Products and Services Index was almost unchanged, edging down 0.01 point to 187.22.

Overall trading activity strengthened during the week.

Total weekly turnover rose to 18.70 billion units worth RM15.92 billion, compared with 17.66 billion units valued at RM14.42 billion in the previous week.

Main Market volume increased to 9.84 billion units worth RM13.95 billion, from 8.91 billion units valued at RM12.59 billion previously.

Warrant turnover also increased to 5.60 billion units worth RM745.83 million.

ACE Market volume, however, eased to 3.15 billion units from 3.42 billion units a week earlier, although its value increased to RM1.60 billion from RM1.11 billion.

The overall outlook for Bursa Malaysia remains positive but increasingly cautious.

Domestic corporate earnings and economic resilience continue to provide underlying support, but investors are likely to remain sensitive to movements in US bond yields, foreign fund flows, crude oil prices and geopolitical developments.

With the FBM KLCI approaching the 1,740-point area, investors may also begin taking profits following recent gains.

For the coming week, analysts expect the benchmark to remain broadly within 1,725 to 1,750, with stronger upside requiring a combination of stable global financial conditions, sustained corporate earnings and improved foreign investor participation.