Technology Sector Faces Selling Pressure Amid Nasdaq Pullback and Chip Demand Concerns

January 27, 2026
Sector Analysis
Star Biz

The Malaysian Technology Index dropped 1.5%, leading the broader market decline. Key tech stocks like Frontken and MPI recorded losses. Investor concerns over the Nasdaq pullback and fears of a slowdown in the global semiconductor cycle are pressuring tech valuations.

The Malaysian technology sector experienced significant selling pressure today, with the Technology Index dropping 1.5% to a two-week low. Frontken fell 2.5% to RM4.25, while Malaysian Pacific Industries (MPI) declined 1.8% to RM30.10. The sell-off was closely linked to the overnight 1.2% drop in the US Nasdaq Index. Although the long-term demand outlook remains positive, the market is currently concerned about inventory adjustments and a slowdown in capital expenditure within the semiconductor industry in the short term. Analysts advise investors to focus on companies with stable contract manufacturing operations and diversified customer bases to weather the current volatility.
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