Malaysia's Tech Sector To Benefit From Heightening US-China Standoff -- PIVB

KUALA LUMPUR, Oct 25 (Bernama) -- Public Investment Bank Bhd (PIVB) is maintaining its “overweight” stance on the technology sector as it sees more inflows of investments into the ASEAN region, with Malaysia standing to benefit significantly from the heightening United States (US)-China standoff. PIVB said that investors should relook at technology stocks with strong fundamentals in the long term given the attractive risk-reward benefits. Malaysia stands out in the region, it said in a research note Tuesday. “We believe there will be positive spillover effects (from) the relocation of industries from China and the US to this region in order to minimise future risks arising from increased US-China tensions. “Malaysia is among the leading countries in terms of investments for the semiconductor, telecommunications and technology industries as it has a favourable eco-system, including talent, infrastructure, and a business-friendly environment,” it explained. Malaysia’s outsourced services assembly and test and automated test equipment players could benefit from trade diversion from the US and China, PIVB said, adding that the ringgit’s current weakness is also attractive for foreign investors. "Malaysia’s semiconductor industry, which takes up 13 per cent of global chip assembly and testing market share, is set to benefit from the recently passed US CHIPS and Science Act (US$52.7 billion in federal subsidies allocated to support chip manufacturing) in the long term, as more assembly and testing jobs are needed to cater for the new state-of-the-art chip fabrication plants with process technology seven nanometres and below," it added. (US$1 = RM4.74) -- BERNAMA