Thursday 28 Mar 2024
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KUALA LUMPUR (Oct 5): The FBM KLCI is seen trending lower today, tracking the weaker overnight close at most global markets, with immediate hurdle at 1,803.

A two-day unloading of U.S. Treasuries pushed their yields to multiyear peaks on Thursday as robust economic data and hawkish speeches by Federal Reserve officials stoked concerns about inflation, hitting Wall Street and stock markets globally, according to Reuters.

The yield on the benchmark 10-year note hit a seven-year high of 3.232 percent following data released the previous day that was seen as increasing the odds a Friday payrolls report would also be stronger than expected, it said.

The Dow Jones Industrial Average fell 200.91 points, or 0.75 percent, to 26,627.48, the S&P 500 lost 23.9 points, or 0.82 percent, to 2,901.61 and the Nasdaq Composite dropped 145.58 points, or 1.81 percent, to 7,879.51, said Reuters.

AllianceDBS Research in its evening edition Thursday said that dampened by the down close in the preceding day, the FBM KLCI had on Oct 4 traded lower to 1,787.88 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 settling off the day’s low at 1,790.11 (down 6.19 points or 0.34%).

“In the broader market, losers outnumbered gainers with 528 stocks ending lower and 317 stocks finishing higher. That gave a market breadth of 0.60 indicating the bears were in better control,” it said.

AllianceDBS Research said the lower low on Oct 4 did not come as a surprise as market participants had also appeared to be not so willing to play on the buying side in the past few days when the benchmark index was in the vicinity of 1,800.

It said this implied that a calculated risk had actually been carried out by the market participants.

“In other words, these market participants basically chose not to be on the side of the market where the odds were seen not in their favour.

“However, there was no stronger follow through selling pressure to push the market lower than 1,787.88 as the day’s low of 1,787.88 had fallen into the support zone of 1,786 and 1,790.

“This can be seen from the return of the benchmark index above the 1,790 level on settlement basis,” it said.

The research house said following the down close on Oct 4, there should be selling attempt with immediate hurdle at 1,803.

“The analysis of overall market action on Oct 4 revealed that buying power was weaker than selling pressure.

“As such, the FBM KLCI would likely trade below the 1,787.88 level on Oct 5,” said AllianceDBS Research. 

Based on corporate announcements and news flow yesterday, companies that may be in focus today may include the following: Malayan Banking Bhd, Aeon Credit Service (M) Bhd, Nestle (Malaysia) Bhd, Press Metal Aluminium Holdings Bhd, Alcom Group Bhd, Eonmetall Group Bhd, FGV Holdings Bhd and DBE Gurney Resources Bhd.

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