This article first appeared in The Edge Malaysia Weekly on July 6, 2026 - July 12, 2026

THE unprecedented blockage of the Strait of Hormuz, which cut off roughly 20% of the world’s oil supply, influenced much of the first half of 2026, stoking fears of a prolonged global energy crisis that would weigh on corporate earnings and global economic growth.

Investors, however, were quick to look past geopolitical risks. Following a sharp sell-off in March, global equities staged a strong rebound in April as markets shifted their focus back to corporate fundamentals and long-term structural growth themes such as artificial intelligence (AI) and the mega initial public offering (IPO) of SpaceX in June that briefly made Elon Musk — still the richest person on the planet — a trillionaire. There were three new additions to the exclusive trillion-dollar club in May: South Korea’s Samsung Electronics Co and SK Hynix, and US-based Micron Technology.

Buoyed by continued optimism surrounding AI and data centre investments, the Bursa Malaysia Technology Index climbed 34.2% in the first half of this year (1H2026), significantly outperforming the country’s benchmark FBM KLCI, which slipped during that period, while the broader FBM Emas Index edged up 0.7%.

Among The Edge’s stock picks, Kelington Group Bhd (KL:KGB) emerged as the best performer, delivering a total return of 54.8% in the first half, aided by the global technology rally.

The industrial gas solutions provider to the electronics and semiconductor industries registered a record net profit of RM150.9 million for the financial year ended Dec 31, 2025 (FY2025), underscoring its strong operational performance.

Our banking pick, Malayan Banking Bhd (KL:MAYBANK), generated a total return of 2.9% in the first half, despite macro environment headwinds stemming from the Middle East conflict. The stock touched a high of RM12.42 on Feb 25, just days before the US and Israel launched attacks on Iran. It has a decent trailing 12-month dividend yield of 5.8%.

Mr DIY Group (M) Bhd (KL:MRDIY) was another standout performer, generating a total return of 7.2%. Our “buy-on-weakness” call proved timely as the home improvement retailer reported a record quarterly net profit of RM192.02 million in the first three months of 2026, driven by stronger margins, festive spending and a larger store network.

For FY2025, the company paid out dividends equivalent to 120% of its earnings, translating into a trailing 12-month dividend yield of 5%.

Supported by a trailing 12-month dividend yield of 3.7%, Tenaga Nasional Bhd (KL:TENAGA) remained a defensive play, delivering a total return of 4.1% during the first half.

Analysts continue to favour the national utility company, viewing it as a prime beneficiary of the National Energy Transition Roadmap (NETR), rising electricity demand from data centres and the acceleration in capital expenditure deployment.

Although IJM Corp Bhd’s (KL:IJM) share price performance was flat during the review period, its shares climbed to RM2.82 in January following Sunway Bhd’s (KL:SUNWAY) takeover offer at RM3.15 per share. The proposed acquisition lapsed in April after Sunway failed to meet the conditional requirement of securing a stake of more than 50% in IJM.

Risk-off sentiment arising from geopolitical uncertainty weighed on Malayan Cement Bhd (KL:MCEMENT), despite continued improvement in its financial performance. The company posted a 34.93% year-on-year increase in net profit to RM246.7 million in the first three months of 2026, driven by stronger demand for its ready-mixed concrete and dry mix products.

PPB Group Bhd (KL:PPB) was an underperformer among our picks, registering a negative return of 16% in 1H2026. Nevertheless, its share price touched RM12.28 in early April, well above the RM11 level at the start of the year.

Although the conglomerate reported a net loss of RM2.73 billion for the financial year ended Dec 31, 2025 (FY2025), due to a huge RM4.17 billion impairment at its Singapore-listed associate Wilmar International Ltd, which contributes 90% of its earnings, PPB’s operating profit before tax showed a significant improvement. It surged to RM1.03 billion in the last quarter of 2025 compared with RM422 million in the previous corresponding period.

Analysts remain positive on PPB’s earnings recovery and expect a stronger dividend payout. The stock currently offers a trailing 12-month dividend yield of 4.5%.

Similarly, Mega First Corp Bhd (KL:MFCB), which is involved in the renewable energy, resources and packaging sector, also ended the first half in negative territory due to its lacklustre financial performance, which was partly attributed to a weak US dollar.

Following the positive returns achieved in the first half, we have decided to lock in profits on Kelington, Mr DIY and Maybank, while removing underperformers IJM Corp, PPB, Malayan Cement and Mega First from our top-picks list.

For the second half of 2026, Tenaga is our only retained pick.

We introduce seven new picks — AMMB Holdings Bhd (KL:AMBANK), MN Holdings Bhd (KL:MNHLDG), Able Global Bhd ­(KL:­ABLEGLOB), Sunway Real Estate Investment Trust (KL:SUNREIT), Sarawak Oil Palms Bhd,  (KL:SOP), KESM Industries Bhd (KL:KESM) and Kerjaya Prospek Group Bhd (KL:KERJAYA) — most of which offer defensive characteristics amid persistent global uncertainty.

Among the stock recommendations of fund managers and heads of research earlier this year, Malacca Securities head of research Loui Low’s pick, Insights Analytics Bhd (KL:IAB), emerged as the best performer, with a total return of 38.2% in the first half of 2026.

The Sarawak-based water technology and intelligent asset management solutions provider has attracted considerable market attention since its listing in October 2025, as analysts expect the firm to benefit from the government’s initiatives to reduce non-revenue water losses and accelerate the digitalisation of water utilities.

The company reported a net profit of RM41.47 million on revenue of RM172.57 million for the financial year ended April 30, 2026 (FY2026). Compared with its listing price of 36 sen, Insights Analytics’ stock has risen more than four times.

For the second half of the year, Low has three new trading ideas — Samaiden Group Bhd (KL:SAMAIDEN), CBH Engineering Holding Bhd (KL:CBHB) and Southern Cable Group Bhd (KL:SCGBHD) — to capitalise on the continuing growth of the data centre and solar power sectors.

Meanwhile, Oasis Home Holding Bhd (KL:OHM), Rakuten Trade head of equity sales Vincent Lau’s pick, generated a total return of 10.6%, supported by its exclusive online distributorship for Fifa World Cup 2026 merchandise.

Oasis Home, Malaysia’s first listed live commerce company, reported a net profit of RM8.81 million for the first nine months ended March 31, 2026, up 10.1% from RM8 million in the same period a year ago. Since listing in May 2025, its share price has risen 30.4% from its listing price of 28 sen.

While retaining underground utilities engineering services provider UUE Holdings Bhd (KL:UUE), Lau chose to take profit on Oasis Home and added Foodie Media Bhd (KL:FOODIE) to his watch list.

Solar player Pekat Group Bhd (KL:PEKAT), the pick of MBSB Research head Imran Yassin Yusof, delivered a total return of 8.9% in the first half, driven by its record earnings of RM45.04 million in the financial year ended Dec 31, 2025 (FY2025). The company has recently proposed to transfer its listing to the Main Market from the ACE Market.

Nonetheless, he favours Tenaga and CelcomDigi Bhd (KL:CDB) for the remainder of this year.

One notable trend emerging from the second-half recommendations is the continued strength of Malaysia’s data centre investment cycle. Four of the recommended stocks — CBH Engineering, UUE Holdings, Southern Cable and MN Holdings — are direct beneficiaries of this structural growth trend.

For more details, refer to the full list of stock picks by The Edge, as well as those recommended by fund managers and heads of research.

Read also:
Cover Story 1: The Edge’s picks
Cover Story 1: Picks by fund managers and heads of research

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