RAKUTEN Trade Sdn Bhd has shaved off 3% from its year-end FBM KLCI forecast to 1,510 due to lowering of earning forecasts and suggesting three blue chips that is expected to provide investors a potential upside of 9% to 15%.
“Although our PLCI performance has been rather disappointing, we are already seeing some buying on the smaller cap and we can see that the small cap index has performed quite well,” Rakuten Trade VP for equity research Thong Pak Leng told a media briefing today.
On the local front, the FBM KLCI ended flat as late accumulation activities helped lift the index higher amid a lackluster session. The index was at 1,446.70 at 3.15pm today.
“Although we noticed bargain hunting is prevalent, overall sentiment remains cautious coupled with a neutral reaction towards the latest Cabinet reshuffle,” he said.
The three blue chip stocks picked by Rakuten were CIMB Group Holding Bhd (3.6% potential upside for stock and 6.7% expected dividend yield), Genting Malaysia Bhd (15.0%, 6.0%) and Tenaga Nasional Bhd (TNB) (15.0%, 4.3%).
As for the Ringgit, Rakuten believes it will hover around the RM4.60/65 range by end-2023 as the US 10-year yield remains stubbornly high.
Going towards 2024, it said the RM should test the RM4.40/50 range in the event of an easing rate trend occurring along with the massive FDIs into the country. – TMR