KUALA LUMPUR: The market sentiment remains cautiously optimistic ahead of Malaysia's 2025 Budget unveiling, according to Moomoo Malaysia.
Its senior equity and derivatives dealer Ahmad Fidauddin expects the FTSE Bursa Malaysia KLCI to trade within the 1,630 to 1,650 range, reflecting a stable but measured environment.
"Investors are particularly focused on how the Budget will address growing global uncertainties and inflationary pressures, both of which have been weighing on sentiment.
"Notably, buying activity currently surpasses selling by 62 per cent, signalling selective optimism, with investors concentrating on sectors they believe are poised to benefit from targeted budget allocations," it said in a statement today.
That said, Moomoo noted that external risks remain top of mind for investors.
It said global factors such as stronger-than-expected economic data from the US or continued slowdowns in China could temper the positive sentiment.
"For now, market participants are positioning themselves cautiously but optimistically, anticipating favourable policy announcements.
"The budget is expected to focus on balancing fiscal responsibility with targeted stimulus efforts in key areas like infrastructure development, sustainability initiatives, and digital innovation.
"These areas, which are closely linked to domestic consumption and longer-term growth, are expected to be among the primary beneficiaries of budgetary support," it added.
Looking ahead, Moomoo said the budget's ability to address Malaysia's pressing economic needs will ultimately dictate market performance.
It noted that if the government delivers a well-calibrated fiscal package to drive growth in key sectors, the KLSE could see gradual upward momentum, with investor confidence fuelling further gains.
Conversely, it said if the budget falls short, particularly in addressing key areas like sustainability and infrastructure, we may see a cautious response, with minor market corrections as investors reassess their positions.
As the budget announcement draws closer, Moomoo also anticipates moderate market activity as investors weigh the potential impacts on their portfolios.
"The budget represents a critical inflection point for market sentiment.
"Its success in aligning fiscal policy with the country's broader economic priorities, against the backdrop of a dynamic global environment—will be a key determinant of whether Malaysia's equity market sustains its current trajectory or encounters a more restrained outlook.
"For investors, the alignment of policy and market expectations will be paramount in sustaining confidence in Malaysia's growth narrative," it noted.