by BERNAMA / pic by TMR FILE

KUALA LUMPUR – CGS-CIMB Securities Sdn Bhd has reiterated that 2021 will be a better year for the equity market as the strong rebound in corporate earnings is set to converge with a sea of ample liquidity.

The research firm said a weak US dollar could spark the return of foreign investor interest in the emerging market, including Malaysia, spurring further gains for the local stock market.

“We maintain our end-2021 forecast FTSE Bursa Malaysia KLCI (FBM KLCI) target of 1,759 points and Inari-Amertron Bhd, Public Bank Bhd and Telekom Malaysia as our top stock picks,” it said in a note today.

As for January, CGS-CIMB said after analysing KLCI’s historical data, the KLCI’s performance tends to be mixed during the reviewed month with an average month-on-month (MoM) negative return of 0.6 per cent over the past 10 years, and positive 1.6 per cent return over the past 42 years.

It said key events to watch for are the Organisation of the Petroleum Exporting Countries (OPEC) meeting (Jan 4), Monetary Policy Committee meeting (Jan 20), United States Federal Open Market Committee (Jan 27), as well as updates on COVID-19 vaccine development.

“Keeping pace with reports on the new COVID-19 cases, and news on whether the conditional movement control order (CMCO) will be extended beyond Jan 14 for Sabah and the Klang Valley as the restricted movement measures will lower consumer spending.

“The market is also likely to track the reopening of schools throughout Malaysia on Jan 20 and follows political events in the country closely,” it said.

CGS-CIMB added that investors would also keep track of the National COVID-19 Immunisation Plan as Malaysia is expected to receive its first batch of vaccines in February 2021.