Friday 29 Mar 2024
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KUALA LUMPUR (Oct 26): The FBM KLCI is expected to drift higher today on some mild bargain hunting with immediate hurdle seen at 1,740 points.

U.S. and European stock markets were knocked lower on Wednesday by corporate earnings concerns, while U.S. bond yields rose on a combination of robust economic data and swirling speculation over who will next lead the Federal Reserve, according to Reuters.

The Dow Jones Industrial Average and the S&P 500 suffered their worst day in seven weeks. The Dow fell 112.3 points, or 0.48 percent, to close at 23,329.46, the S&P 500 lost 11.98 points, or 0.47 percent, to 2,557.15 and the Nasdaq Composite dropped 34.54 points, or 0.52 percent, to 6,563.89, it said.

European shares closed lower, with a mixed batch of company results sparking profit-taking, a day before the European Central Bank is expected to signal a reduction in its bond-buying scheme, gradually withdrawing post-crisis stimulus, said Reuters.

AllianceDBS Research in ite evening edition Wednesday said that dampened by the down close in the preceding day, the FBM KLCI had on Oct 25 traded lower to 1,733.67 as market participants continued to play on the selling side in anticipation of a lower market.

It said under the persistent selling interest, the benchmark index was in the red throughout most of the trading sessions before rebounding to settle near the day’s high of 1,739.05 (up 2.91 points or 0.17%).

“In the broader market, losers outnumbered gainers with 467 stocks ending lower and 362 stocks finishing higher. That gave a market breadth of 0.77 indicating the bears were in control,” it said.

AllianceDBS Research said the market saw follow through selling interest on Oct 25 with the benchmark index falling further to a low of 1,733.67.

“A buying attempt on the opening bell was made, but the initial buying strength was not strong enough to carry the market much higher above the opening level.

“This gave rise an opportunity for aggressive market participants to sell again. The market has been drifting lower since Sept 13 with only 7 up closes and 22 down closes over the past 29 market days.

“However, with the benchmark index about 3 points away from the 1,730 level measuring from the day’s low of 1,733.67, selling interest began to fizzle out because 1,730 is seen as a demand level,” it said.

The research house said following the up close on Oct 25, there should be buying attempt again with immediate hurdle at 1,740.  

“The analysis of overall market action on Oct 25 revealed that buying power was stronger than selling pressure.

“As such, the FBM KLCI would likely trade above the 1,740.51 level on Oct 26,” said AllianceDBS Research.

Based on corporate announcements and news flow yesterday, stocks in focus today may include: Maxis Bhd, Malaysian Resources Corp Bhd, Capitaland Malaysia Mall Trust, Bursa Malaysia Bhd, Marine & General Bhd, Gadang Holdings Bhd, Hua Yang Bhd, Priceworth International Bhd, Pantech Group Holdings Bhd and Willowglen MSC Bhd.

 

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