As such, it has kept its end-2023 benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) target unchanged at 1,650 points, as no major revisions to earnings of index-component stocks were seen in the fourth quarter (Q4) of 2022.

“Fundamentally, macro conditions in 2023 are not too dissimilar to that of 2022,” it said in a research note today.

PIVB cautioned that H1 2023 would remain uncertain as global economies work through the full effects of aggressive rate hikes over the last six months.

“Sentiment is weak, understandably, but the market is also relatively undervalued. We wouldn’t be in a hurry to get into the market at this juncture, but retain sufficient optimism to suggest buying into market weakness to ride on the upside going into H2 2023.

“Though the FBM KLCI continues to struggle to break out of its range-bound trading band, sufficient reasons warrant continued exposure in the market,” it said, adding that uncertainties and resultant volatilities will be an ongoing feature.

PIVB also said earnings of heavily-weighted banks and plantations were largely unchanged in Q4, with tweaks in telecommunications (positive) and chemical/consumer (negative) largely negating each other.

“The 2023 and 2024 earnings baskets are anticipated to expand by 9.6% and 5.8% (respectively), the slightly more pronounced 2023 growth a result of base effects,” it said.

Going into 2024, it said Malaysia’s economic growth direction and earnings picture would depend on the severity or wear-off of the downside risks, which, at this point, is “not expected to be severe”.

The FBM KLCI finished 3.99 points lower at 1,450.20 yesterday from Tuesday’s closing of 1,454.19 on tepid buying interest.