Welcome to our monthly economic and market update! As we enter a new month, here’s a recap of the key economic and market developments in India from February. Let’s get started.
Malaysia economy update
- Malaysia’s economy grew by 5.1% in 2024, meeting the government’s target of 4.8% to 5.3%, driven by strong domestic demand and recovering exports. However, growth slowed in the final quarter amid emerging headwinds for the country’s manufacturing sector.
- Malaysia’s sovereign wealth fund, Khazanah Nasional, reported a 13.5% decline in operating profit for 2024, totaling 5.1 billion ringgit ($1.15 billion), citing weaker private market performance due to higher interest rates and a challenging financing environment. The fund plans to diversify its portfolio to navigate these challenges.
- Malaysia’s producer price index (PPI) rose 0.8% year-on-year in January 2025, up from 0.5% in December, driven by a 16.5% increase in the agriculture, forestry, and fishing sector. Meanwhile, the mining sector contracted 1.3%, and manufacturing declined 0.6%. Month-on-month, PPI growth slowed to 0.3% from 0.8% in December.
- UBS forecasts Malaysia’s GDP to grow 4.5% in 2025, at the lower end of the official 4.5-5.5% target, as domestic demand and investment inflows offset slowing exports amid potential US tariffs. Economist Grace Lim expects consumption growth to ease but remain strong, supported by wage increases, low unemployment, and progressive fiscal policies.
Malaysia stock market update
February saw mixed movements in Malaysia’s stock market. The FTSE Bursa Malaysia KLCI rose by 1.14%, closing at RM1,574.70. However, the FTSE Bursa Malaysia Mid 70 Index faced a significant decline of 5.40%, ending at RM16,636.63, while the FTSE Bursa Malaysia Top 100 Index dipped by 0.69% to RM11,496.57. A month of divergence across key indices amid ongoing market uncertainties.
- Petronas Gas Bhd reported a 34% drop in net profit for 2024, falling to 49.1 billion ringgit ($11 billion), marking its second consecutive annual decline due to lower commodity prices. Total revenue also decreased by 7% to 320 billion ringgit, as lower realized prices weighed on profitability.
- Bank Islam Malaysia Bhd reported a 9.1% year-on-year rise in net profit for Q4 2024, reaching RM172.64 million, driven by higher net income and lower impairment allowances. Quarterly revenue increased 6.3% to RM1.24 billion, supported by investment securities and financing growth.
- Petronas Chemicals rebounded to profitability in 4Q 2024, reporting a net profit of RM519 million, driven by a RM748 million forex gain linked to a joint venture loan revaluation. Revenue rose 3.4% to RM7.46 billion, reversing the previous quarter’s loss. The company declared a three sen dividend.
- Analysts warn that Maxis‘ 5G spending could pressure future earnings and dividend payouts, as higher access costs weigh on profitability. Despite reporting 2024 results in line with expectations, concerns persist over Maxis’ smaller 5G subscriber base and competitive challenges.
Malaysian top gainer and top loser stocks for February
Summary
Overall, Malaysia’s economy grew 5.1% in 2024, hitting government targets despite Q4 slowdown. Khazanah Nasional’s profit fell 13.5% due to high interest rates, while Malaysia’s PPI rose 0.8% in January, driven by agriculture growth. UBS forecasts 4.5% GDP growth in 2025, citing strong domestic demand despite global trade risks. Markets showed mixed trends—FTSE Bursa Malaysia KLCI gained 1.14%, while Mid 70 and Top 100 indices declined. Petronas Gas posted a 34% profit drop, while Petronas Chemicals rebounded. Bank Islam Malaysia saw 9.1% profit growth, while analysts raised concerns over Maxis’ 5G spending.
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