KLCI Extends Rally as Plantation Stocks Lift Market Despite Middle East Tensions

Malaysia’s benchmark index advanced on plantation strength and sustained foreign inflows, although escalating Middle East tensions and surging oil prices are expected to keep investors cautious this week.

KLCI Gains Amid Uncertainty

Malaysia’s benchmark FBM KLCI extended its winning streak on Monday, climbing 6.95 points, or 0.41%, to close at 1,698.44 as strong gains in plantation and commodity-related stocks outweighed cautious regional market sentiment.

The positive performance came despite a broader market where declining stocks outnumbered gainers by 653 to 441. Investor confidence was supported by a third consecutive session of net foreign buying, reflecting continued interest in Malaysian equities amid the country’s stable macroeconomic outlook.

Plantation counters led sectoral gains, rising 2.01%, followed by the Energy sector with a 0.58% increase and Telecommunication and Media, which gained 0.56%. Meanwhile, Technology stocks fell 1.77%, making them the day’s biggest losers, followed by Utilities, which declined 0.82%.

Global markets, however, painted a more cautious picture. Wall Street retreated after U.S. President Donald Trump announced the reinstatement of a blockade on Iranian shipping through the Strait of Hormuz.

The move pushed crude oil prices sharply higher, with both Brent and WTI gaining more than 9%, while semiconductor shares led losses across U.S. markets.

The renewed geopolitical tensions followed weekend exchanges of airstrikes between the United States and Iran, increasing concerns over global energy supplies and inflation risks. Asian markets also recorded mixed performances as investors assessed the latest developments.

Looking ahead, market participants expect the FBM KLCI to remain resilient, although external uncertainties could trigger increased volatility. Analysts believe continued foreign fund inflows and Malaysia’s relatively stable economic fundamentals may help cushion the impact of global market weakness.

Plantation and energy-related stocks are expected to remain in focus as elevated crude oil and firm crude palm oil prices support earnings prospects. Conversely, technology and utility counters may continue facing selling pressure following weakness in global technology shares.

Technically, the FBM KLCI remains above key moving averages, with 1,700 serving as the next major resistance level.