RHB Research maintains an "overweight" rating on the basic materials sector. Press Metal Aluminium Holdings Bhd is the firm's top pick.
The company benefits from Middle East conflict disruptions to aluminium supply and pricing. This conflict restricts aluminium and alumina passage through the Hormuz Strait. Spiking crude oil and coal prices increase regional smelter operating costs.
RHB Research raised its London Metal Exchange aluminium price assumption to US$3,250 per tonne. Spot aluminium prices increased 24% year-to-date in 2026. These prices average US$3,275 per tonne.
Outlook risks include raw material cost inflation and a broader economic slowdown. Weaker average selling prices for aluminium also pose a risk.