KUALA LUMPUR (June 30): As largely expected, the Malaysian stock market had a rather dismal showing in the first half of this year, as prices of palm and crude oil — the two main commodities the country exports — normalise, while the global monetary tightening that played a part in triggering the banking crisis in the US and Europe continues to drive the exodus of foreign funds from the local market.

The weaker-than-expected economic rebound in China, Malaysia’s largest trading partner, following the much-anticipated reopening of her international borders also weighed on sentiment across Asia.

This led the FBM KLCI, the local stock market's bellwether that tracks its largest 30 stocks, recording a 7.16% decline in the Jan 1-June 28 period to 1,388.37 points, with a price-earnings of 12.63 times.

This makes it the worst performer among the local stock exchange's indices, and the second worst among its regional peers, behind Thailand. (see Table of KLCI vs regional peers)

In contrast, the next group of largest companies — the FBM Mid 70 Index — emerged the top performer, even as more than half its constituents declined.

The index, which measures the next 70 largest companies on the stock exchange, climbed 2.83% in the same period to 13,382.96 points, with a PE multiple of 16.37 times, lifted by gains in 32 counters. The top gainer was YTL Corp Bhd, which rose 72%, followed by Hextar Technologies Solutions Bhd (54%), Velesto Energy Bhd (47%) and Boustead Plantations Bhd (42%).

Over two-thirds of the KLCI constituents worsened during 1H2023, with Petronas Chemicals Group Bhd leading the pack, down by 29%, followed by Mr DIY Group (M) Bhd’s 21% decline and Axiata Group Bhd’s 14% drop.

The benchmark index has erased all of the gains it recorded when the Unity Government was formed last November, when investors celebrated the news and boosted KLCI to as high as 1,501.88 briefly, before trending down shortly after.

The most notable decline was in March this year, when sentiment towards local banks — most of them KLCI heavyweights — weakened in the midst of the US banking crisis after the Silicon Valley Bank failed following steep interest rate hikes in the world's largest economy. (See chart: Bursa Malaysia Finance index correlates with KLCI)

Bursa Malaysia’s Property and Construction indices outperformed their peers in 1H2023, with both climbing since December 2022, albeit with a short hiccup in March. (See: Bursa Property index vs Construction index Chart; table on Sectoral Indices Comparison)

The Bursa Malaysia Property Index saw 53 of its 96 constituents gain in 1H2023, led by Ewein Bhd’s 219% rise, followed by Yong Tai Bhd’s 118% increase and Seal Inc Bhd’s growth of 96%.

For Bursa Malaysia Construction Index, 17 of its 49 constituents recorded gains, led by WCE Holdings Bhd’s 93% climb, followed by Advancecon Holdings Bhd (38%) and Ahmad Zaki Resources Bhd (36%).

The Industrial Products and Services Index and the Consumer Products and Services Index are the two indices that recorded the biggest decline among peers, down 13.15% and 6.6% respectively, followed by Financial Services (down 6.5%), Plantation (5.1%), Healthcare (4.7%) and Technology (4.4%).

The Industrial Products and Services Index was dragged by laggards like Computer Forms (Malaysia) Bhd, which dropped 93%, and Progressive Impact Corp Bhd, down 71%. The index saw 142 of its 222 component stocks end lower in 1H2023.

As for the 164 stocks under Consumer Product and Services Index, 90 of them declined, with biggest laggards including Classita Holdings Bhd (down 74%), followed by Mpire Global Bhd (55%) and Jadi Imaging Holdings Bhd (47%).

Breaking down Bursa Malaysia securities YTD performances by their market capitalisation, share price appreciation of YTL Power International Bhd and YTL Corp Bhd top their peers with valuation of above RM5 billion, rising 79% and 72% respectively in 1H2023 as investors took cue from improved energy sales volume and prices in Singapore operations.

YTL Group’s gains were followed by Chin Hin Group Bhd’s 39% climb and Gamuda Bhd’s 19% increase amid recovery in construction activities in the country and slew of job wins by Gamuda.

Notably, only 21 of the 61 stocks under this category recorded gains in 1H2023, with losers led by Hap Seng Consolidated Bhd’s 48% decline, followed by Petronas Chemicals and Mr DIY Group.

For groups of companies with valuations between RM1 billion and RM5 billion, losers beat winners by 62 to 59 counters, with gainers led by newly listed tech stocks Nationgate Holdings Bhd’s 256% jump upon listing and Oppstar Bhd’s 206% increase, followed by WCE Holdings.

Berjaya Food Bhd was the biggest loser in this category, as it dropped 43% in 1H2023 as inflation and the weaker ringgit ate into consumer spending power.

Among companies with market capitalisation between RM500 million and RM1 billion, Thailand-based Malaysia-listed consumer packaged foods distributor Wellspire Holdings Bhd topped the list of gainers, having gained 228% since its listing in January.

The first runner-up in this category was AirAsia X Bhd, posting over 200% gain on the continued recovery in air travel demand while oil prices remained subdued amid recession worries, easing cost pressure for airliners.

Meanwhile, stationery supplier Pelikan International Corp Bhd was the third largest gainer in this category, as the stock trended upward amid talk of it selling major assets and businesses, climbing over 125% YTD. The company announced this morning it is selling Pelikan Group GMBH (PGG) to Holdham SAS for €136mil (about RM695.44 mil), which will see the group exit from its core stationery business. After the sale, it plans to distribute most of the proceeds to shareholders.

Senheng New Retail Bhd and Kobay Technology Bhd, meanwhile, were the two biggest losers in this category, down 39% and 30% respectively.

For market caps between RM100 million and RM500 million, SMRT Holdings Bhd was the top gainer, up 424%, followed by Silver Ridge Holdings Bhd’s 352% gain and Ewein, while losers were led by Revenue Group Bhd (down 62%) and Hong Seng Consolidated (down 59%).

Smaller companies with valuation of below RM100 million had Barakah Offshore Petroleum Bhd as the top gainer (up 140%), followed by Key Alliance Group Bhd (up 100%), while losers were led by Computer Forms.