PETALING JAYA: Business sentiment among Malaysian companies dived to a new low in Q2 2020, with the Dun & Bradstreet (D&B) Malaysia Business Optimism Index (BOI) plunging into the contractionary zone to -21.52 percentage points, from 10.22 percentage points in Q1 2020.
On a year-on-year (yoy) basis, the BOI fell to -21.52 percentage points in Q2 2020, from 5.61 percentage points in Q2 2019.
Dun & Bradstreet Malaysia Sdn Bhd CEO Audrey Chia said sentiments among Malaysian firms have plunged to a new low, due largely to the recent surge in Covid-19 cases.
“We expect the dampened outlook to persist into the second and third quarter of 2020 given that a potential near-term recovery of the hardest-hit sectors such as services and transportation is quite unlikely.
However, we might be able to see some green shoots once the active cases begin to peak globally. In view of these adverse developments, we have trimmed our 2020 growth forecast to 4%,” she said in a statement.
The six business indicators under the quarterly BOI study include volume of sales, net profits, selling price, inventory level, employees and new orders.
On a yoy basis, all six indicators have declined for Q2 2020.
The volume of sales fell to -27.84 percentage points in Q2 2020 from 6.83 percentage points in Q2 2019, while net profits dropped to -40.20 percentage points from +1.95 percentage points previously.
Selling prices fell to -10.31 percentage points in the second quarter from 6.83 percentage points, and new orders plunged to -26.80 percentage points in Q2 2020 from 10.24 percentage points at the same time last year
Inventory levels also fell to -20.62 percentage points in Q2 2020 from 4.39 percentage points in Q2 2019, while employment levels dropped to -5.21 percentage points from 3.41 percentage points a year ago.
Looking ahead D&B said for Q2 2020, the majority of the sectors are pessimistic about the outlook, with the services and transportation sectors being the least optimistic.