‘MARKET PERFORM’ RATING STAYS
Bursa Malaysia likely to post Q4 earnings of up to RM68m, says Kenanga Research
KENANGA Investment Bank Bhd (Kenanga Research) expects Bursa Malaysia to register fourth quarter earnings of between RM63 million and RM68 million.
There would also likely be a final dividend of 12 sen per share, bringing the full-year payment to 27 sen, it said.
The research firm noted that the key index’s fourth quarter average daily trading volume (ADTV) was mostly as expected at RM1.94 billion, or down 23 per cent year-on-year.
“We had expected readings to trail close to RM2 billion with support from the earlier-than-expected 15th General Election.
“We observed that peak trading occurred in the days subsequent to the formation of the unity government while window-dressing activities did bolster the final trading day.
“With this, we believe that Bursa Malaysia’s reported earnings in the fourth quarter to register between RM63 million and RM68 million.”
The research firm expects quantitative merits to be generally stronger on economic normalisation post-Covid-19 pandemic.
“Qualitatively, sentiment could be marred by concerns of a global recession, likely stemming from unprecedented inflation rates squeezing overall income with cooling measures from tighter monetary policies looking to impede overall economic output.”
Kenanga Research has set its ADTV for this year at RM2.3 billion, up 12 per cent year-on-year.
“We believe that a meaningful positive catalyst to counteract the recessionary pressures may come in the form of China’s reopening,” it said, adding that the strict Covid-19 containment measures earlier had effectively restrained economic growth in China and crippled certain sectors.
The research firm said China’s economic revitalisation could lead to an influx of demand and spending that could bring buoyancy to sentiment.
Kenanga Research has kept its “market perform” call on Bursa Malaysia with a target price of RM6.60.