KUALA LUMPUR (April 4): The FBM KLCI is seen trending sideways today with immediate support at 1,848, following the higher overnight close at most global markets.
A gauge of global equity markets edged higher on Tuesday on a rebound in Amazon.com shares and as a still bright earnings outlook offset a somber mood among investors, while the U.S. dollar rose on easing concerns over a China-U.S. trade spat, according to Reuters.
Oil prices rose after their biggest one-day fall in almost a year on Monday, though higher Russian output and Saudi Arabia possibly cutting selling prices dragged on crude trading, it said.
The Dow Jones Industrial Average rose 389.17 points, or 1.65 percent, to 24,033.36. The S&P 500 gained 32.57 points, or 1.26 percent, to 2,614.45 and the Nasdaq Composite added 71.16 points, or 1.04 percent, to 6,941.28, said Reuters.
AllianceDBS Research in its evening edition Tuesday said dampened by the down close in the preceding day, the FBM KLCI had on April 3 traded lower to 1,849.08 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 near the day’s low at 1,850.78 (down 7.57 points or 0.41%).
“In the broader market, losers outnumbered gainers with 699 stocks ending lower and 236 stocks finishing higher. That gave a market breadth of 0.33 indicating the bears were in control,” it said.
AllianceDBS Research said the market made a lower low on April 3 with the benchmark index falling to a low of 1,849.08.
“The market opened the day on a weak note, with no sign of bargain hunting buying interest coming into play.
“The inability on the part of the market to go higher than 1,858.78 saw profit taking activity to kick in, this put pressure on the benchmark index to break below the 1,850 level,” it said.
The research house said following the down close on April 3, there should be selling attempt with immediate support at 1,848.
It said a fall below 1,848 could send the market down to 1,838.
“The analysis of overall market action on April 3 revealed that buying power was weaker than selling pressure.
“As such, the FBM KLCI would likely trade below the 1,849.08 level on April 4,” said AllianceDBS Research.
Based on corporate announcements and newsflow yesterday, stocks in focus today could include: Vertice Bhd, Tien Wah Press Holdings Bhd, Bina Puri Holdings Bhd, MyEG Services Bhd, Lee Swee Kiat Group Bhd, Malaysia Airports Holdings Bhd and UMW Holdings Bhd.