KUALA LUMPUR (Aug 15): The FBM KLCI is expected to extend its gains today in line with the overnight advance at most global markets, immediate support seen between 1,760 and 1,765.
Stocks around the world rose along with U.S. Treasury bond yields and the U.S. dollar on Monday as investors regained some appetite for riskier assets as the United States and North Korea appeared to take a break from their war of words, according to Reuters.
After a week of market jitters from increasingly aggressive exchanges between the nuclear-armed nations, investors were emboldened after South Korea's president said resolving North Korea's nuclear ambitions must be done peacefully and U.S. officials played down the risk of an imminent war, it said.
The Dow Jones Industrial Average rose 135.39 points, or 0.62 percent, to 21,993.71, the S&P 500 gained 24.52 points, or 1.00 percent, to 2,465.84 and the Nasdaq Composite added 83.68 points, or 1.34 percent, to 6,340.23, said Reuters.
AllianceDBS Research in its evening edition Monday said the FBM KLCI had on Aug 14 traded marginally lower to 1,766.37 as some market participants continued to play on the selling side in anticipation of a lower market.
However, it said non-follow through selling pressure in the area of 1,766.37 prompted risk buying interest to chip in.
The research house said this lifted the benchmark index to 1,772.56 before settling near the day’s high at 1,771.08 (up 4.12 points or 0.23%).
“In the broader market, gainers outnumbered losers with 506 stocks ending higher and 316 stocks finishing lower. That gave a market breadth of 1.60 indicating the bulls were in better control,” it said.
AllianceDBS Research said the market made a lower low on Aug 14 with the benchmark index falling marginally to 1,766.37.
“Instead of seeing an immediate strong follow through selling pressure to push the market down to a much lower level, we only saw a light follow through selling interest after the opening bell.
“This showed that many market participants were unwilling to sell aggressively into the market even though the market environment was seen turning bearish after last Friday market sell-off. While it may be pre-mature to confirm anything, the risk buying activity we saw was encouraging.
“This is because the way this market carried itself on 14 Aug 2017 implied that there was no visible sign of big selling orders,” it said.
The research house said following the up close on Aug 14, there should thus be buying attempt again with immediate support zone pegged between 1,760 and 1,765.
“The analysis of overall market action on Aug 14 revealed that buying power was stronger than selling pressure.
“As such, the FBM KLCI would likely trade above the 1,772.56 level on Aug 15,” said AllianceDBS Research.
Based on corporate announcements and news flow yesterday, stocks in focus today may include the following: Media Prima Bhd, UEM Edgenta Bhd, Guan Chong Bhd, YFG Bhd, Asiamet Education Group Bhd, Asia Knight Bhd, Utusan Melayu (Malaysia) Bhd and Hap Seng Consolidated Bhd.