KUALA LUMPUR (Sept 21): The FBM KLCI is expected to stay lacklustre today on the back of the global equity markets’ weakness as well as lack of tangible fresh catalysts at the local market.

Stocks on major markets slipped on Friday and bond prices rose, pushing yields sharply lower, after the US Federal Reserve on Thursday clung to its near-zero interest rate policy with global economic growth slowing, according to Reuters.

Stocks and currencies in emerging markets, which are more vulnerable to higher US interest rates, briefly welcomed the Fed's decision to postpone an interest rate rise, but their bounce faded with the persistent sell-off in developed markets, it said.

AllianceDBS Research in its evening edition last Friday said that after opening the day on a weak note, the FBM KLCI fell further to a low of 1,661.56 as market participants decided to play a selling game ahead of weekend.

The research house said in the absence of stronger supportive buying interest, the benchmark index was in the red throughout most of the trading sessions before settling off the day’s low at 1,669.45 (down 12.09 points or 0.72%).

“In the broader market, gainers outnumbered losers with 482 stocks ending higher and 384 stocks finishing lower. That gave a market breadth of 1.25 indicating the bulls were in control,” it said.

AllianceDBS Research said the lower high and lower low on Sept 18 was a little surprise given the upside gap creation and the crossover of the 50-day MA line in the preceding day.

“Over the past 9 trading days, the benchmark index had risen by 124 points measuring from the low of 1,567 (Sept 7) to the high of 1,691 (Sept 17) with market registering 6 up days and 3 down days.

“Following the down close on Sept 18, the market is likely to move between 1,653 and 1,691 in the coming few days.

“A fall below 1,653 would put pressure on the market down to the subsequent support at 1,639,” it said.

The research house said that conversely, a rise above 1,691 could lift the benchmark index to the 1,700 psychological level, adding that indicator wise, the MACD was above the nine-day moving average line.

“The analysis of overall market action on Sept 18 revealed that buying power was weaker than selling pressure.

“As such, the FBM KLCI would likely trade below the 1,661.56 level on Sept 21,” said AllianceDBS Research.