KUALA LUMPUR (Feb 21): The benchmark FBM KLCI retreated in early trade on Wednesday, in tandem with regional markets, following the overnight dip on Wall Street.

At 9.05am, the FBM KLCI had dipped 0.36% or 5.54 points to 1,550.05.

The early losers included Ajinomoto (Malaysia) Bhd, Petronas Gas Bhd, Petronas Chemicals Group Bhd, Allianz Malaysia Bhd, Dialog Group Bhd, Globetronics Technology Bhd, Tenaga Nasional Bhd and Uzma Bhd.

The actives included MMAG Holdings Bhd, Lay Hong Bhd, Dialog, Supermax Corp Bhd, Bumi Armada Bhd, Velesto Energy Bhd and KNM Group Bhd.

Hong Leong Investment Bank (HLIB) Research said foreigners’ underweight position on Malaysia had been one of the largest in the past decade, but this had bottomed amid the recent strong return of foreign investors (following four consecutive months of net inflows), supported by an uptick in foreign shareholdings to 19.6% in January from 19.5% in November and December, while year-to-date foreign net inflows amounted to about RM2 billion, versus a RM2.6 billion outflow in 2023.

Moreover, the research house said risk appetite for emerging markets should resurface, with: i) the US Federal Reserve’s eventual pivot to lower interest rates; ii) a stronger Malaysian gross domestic product growth estimated at 4.8% in 2024, from 3.7% in 2023, in line with global growth of 3.1% estimated by the International Monetary Fund; iii) a more stable political climate domestically; and iv) China’s indications of strong measures to revitalise its slowing economy, which will spur positive spillover effects on key trading nations like Malaysia.

“We expect persistent buoyant foreign net buying to lift the KLCI towards 1,570-1,580 zones before profit-taking emerges,” HLIB said.

Bloomberg, meanwhile, reported that Asian stocks fell after a tech-led retreat on Wall Street, with all eyes on Nvidia Corp’s earnings due later on Wednesday, and the impact of China’s latest market support measures.

Shares dropped from Japan to South Korea and Australia, with Hong Kong equity futures declining as well. The region’s weak tone came after the Nasdaq 100 fell almost 1%, and the S&P 500 slid below 5,000. Nvidia sank more than 4% in the run-up to its results later on Wednesday, where traders will be looking for confirmation the chipmaker can meet the lofty expectations set by the artificial-intelligence boom, Bloomberg reported.