Malaysian shares are set to remain bearish in the week ahead over concerns of domestic political uncertainties and a weaker US economy, analysts said on Friday.
Opposition leader Anwar Ibrahim, who has said he intends to topple the government, announced Thursday he will contest a by-election that could pave the way for his return to public office despite looming sodomy allegations.
The former deputy premier has claimed that the allegations by a young male aide were fabricated to block him from bringing down the government. "Upside for the local market is seen capped given increased domestic political uncertainties," local brokerage TA Securities said in a research note.
The brokerage said concerns over a weaker US economy will also influence investors in the coming week. "Weak follow-through buying interest, with the overnight fall on US stocks following weaker-than-expected economic growth and high jobless claims (is expected) to further dampen market tone," the note said. It said the bearish tone of the market will encourage investors to take profits or reduce exposure. For the week to August 1, the composite index gained 17.35 points or 1.5 percent to 1,159.10.
Daily average volume was higher at 552 million shares worth 749 million ringgit (230 million dollars) from 465.6 million shares worth 992 million ringgit last week.
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