Friday 29 Mar 2024
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KUALA LUMPUR (Sept 11): The FBM KLCI is likely to trade above the 1,600-point level albeit with limited gains in line with the softer overnight close at global markets on lingering worries over the Chinese and Japanese economies.

Global equity markets outside the United States fell on Thursday as concerns about the economies of China and Japan added uncertainty to the world growth picture, but Wall Street rose, due in part to a rebound in oil prices, according to Reuters.

The FTSEurofirst 300 index of top European shares snapped a three-day rally to close down 1.4%, following a disappointing session in Asia, it said.

AllianceDBS Research said that after opening the day on a negative note, the FBM KLCI traded down to a low of 1,586.84 as market participants continued to play on the selling side in anticipation of a lower market.

However, the research house said supportive buying interest pulled the benchmark index back up into the 1,600 zone in the post afternoon session before settling at the day’s high of 1,614.02 (up 10.66 or 0.66%) in the last few minutes selective buying of blue chips.

“In the broader market, losers outnumbered gainers with 422 stocks ending lower and 354 stocks finishing higher. That gave a market breadth of 0.83 indicating the bears were in control,” it said.

AlianceDBS Research said the downside gap left behind in the previous day was filled on Sept 10.

“However, the lower low followed by an up close on Sept 10 was positive as it indicated the availability of supportive buying power in the game play.

“Given the overall market behaviour over the past 4 days, buyers are seen to have an upper hand over the sellers, because the rebound from the low of 1,567 (Sept 7) to close above the 1,580 level suggested the willingness of market participant to buy into the market, and the market reversal from earlier selling to late buying (Sept 10).

“This kind of sustained buying pressure should thus allow us to see firmer market again with immediate hurdle at 1,615. A crossover of 1,615 would lift the market to the next resistance zone, 1,621–1,626,” it said.

The research house said indicator wise, the MACD was above the nine-day moving average line.

“The analysis of overall market action on Sept 10 revealed that buying power was stronger than selling pressure.

“As such, the FBM KLCI would likely trade above the 1,614.02 level on Sept 11,” said AllianceDBS Research.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)

 

 

 

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