Ringgit oversold by 10% to 12%, says Public IB Research

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KUALA LUMPUR (Dec 16): Public IB Research said the ringgit is undeniably weak, and sees it remaining so in the near term as the US Dollar continues to strengthen.

In a strategy note today, the research house said it also thinks the ringgit has perhaps been oversold by about 10% to 12%, which may suggest a potential reversal of foreign flows when the dust eventually settles. 

“Interestingly, and no matter what the circumstance, the FBM KLCI has always ended up higher than where it was 18 months prior to the General Elections.

“Granted there may not be overwhelmingly exciting developments right this point to warrant re-entry in a big way as capital outflows continue to run its course, more so in light of current uncertainties which is likely to persist for a while, we do see the markets primed for investors with a longer-term horizon and to position for a turnaround,” it said.

Public IB Research said its year-end 2017 target is 1,750 points and suggested stocks for the year are Genting Plantations Bhd, Kossan Rubber Industries Bhd, Chin Hin Group Bhd, Ta Ann Holdings Bhd, SCGM Bhd, Sime Darby Bhd, SapuraKencana Petroleum Bhd, Wah Seong Corporation Bhd and LBS Bina Group Bhd.

“We are Overweight on the Plantations, Power, Oil and Gas and Construction sectors,” it said.