KUALA LUMPUR: MIDF Research forecasted Bursa Malaysia’s KLCI to return to 1,680 at the end of 2020 underpinned by the recovery in mining output and strong growth of domestic-oriented industries.
“In 2020, global commodity prices are expected to stay at profitable levels and we forecast Brent crude oil price to average at US$65 per barrel and crude palm oil at RM2,450 per metric tonne,” its head of research Mohd Redza Abdul Rahman told the media at a briefing.
He elaborated that most of the earnings in the composite index will be coming from the banking, plantations, oil & gas and industrial product (Petronas Chemical) sectors as well as a recovery in the telecommunications sector.
In regards to Malaysia’s trade, MIDF’s economist Muhammad Zafri Zulkeffeli predicted that the country’s export and import will grow at lower pace from the contraction experienced this year.
“Next year will register an estimated growth of 0.9% to 1.4% due to the low base effects this year,” he said.
He elaborated that the expected growth is mainly due to the commodities based exports, crude palm oil, crude petroleum and LNG.
The research house expected a slight rebound in Malaysia trade balance next year with exports improving to 1.5% from an expected contraction of 1.1% this year and import rising to 0.8% from an expected decline of 4.6% in 2019.
“For 2020, Malaysia trade balance surplus is expected to hit RM147.6 billion from an expected trade surplus of RM142.2 billion in 2019,” said Zafri.
