It is, however, probably going to get worse for the market in the coming months before the expected rebound towards the fourth quarter of this year (4Q23), according to CGS-CIMB Research. “We expect the poor market sentiment to continue for the next few months despite forward valuations falling to two standard deviations below the post-Global Financial Crisis mean,” the brokerage said. These rerating catalysts, according to CGS-CIMB Research, included a weakening of the US dollar, with a convincing break down of the US Dollar Index (DXY) below the psychological 100 mark. “Our earnings gap analysis shows that the FBM KLCI could reach 1,610 points by year-end, and 1,800 points by end-2024,” CGS-CIMB Research said. “With the right triggers in place, upside to the FBM KLCI and FBM100 could be significant, in our opinion, underscored by their multi-year low valuations,” CGS-CIMB Research said.
