KUALA LUMPUR (Aug 16): The FBM KLCI is expected to trade range-bound today with support seen at 1,765 points.
The U.S. dollar and U.S. Treasury yields climbed on Tuesday after solid U.S. retail data and an easing in U.S.-North Korean rhetoric, but Wall Street was held down by weakness in retail stocks, according to Reuters.
After last week's market jitters from escalating U.S.-North Korea tensions, investors were relieved to be able to look beyond geopolitics at least temporarily after North Korean leader Kim Jong Un said he would watch the United States' actions for a while longer before deciding whether to fire missiles toward the U.S. island territory of Guam, it said.
The Dow Jones Industrial Average rose 5.28 points, or 0.02 percent, to 21,998.99, the S&P 500 lost 1.23 points, or 0.05 percent, to 2,464.61 and the Nasdaq Composite dropped 7.22 points, or 0.11 percent, to 6,333.01, said Reuters.
AllianceDBS Research in its evening edition Tuesday said the FBM KLCI had on Aug 15 opened the day on a positive note.
It said the benchmark index subsequently traded higher to 1,773.66.
However, the research house said non-follow through selling pressure in the area of 1,773.37 prompted profit taking activity to chip in.
It said this pushed the benchmark index down to a low of 1,768.76 before rebounding to settle near the day’s high at 1,772.39 (up 1.31 points or 0.07%).
“In the broader market, gainers outnumbered losers with 523 stocks ending higher and 329 stocks finishing lower. That gave a market breadth of 1.58 indicating the bulls were in better control,” it said.
AllianceDBS Research said the market registered a higher high on Aug 15 with the benchmark index rising marginally to 1,773.66.
“This showed that market participants were unwilling to play a more aggressive buying game as the benchmark index was less than 2 points away from the immediate hurdle of 1,775.
“However, market participants were also seen NOT eager to sell down the market after dipping below the 1,770 level.
“This can be seen from the day’s low of 1,768.76 and the return of the benchmark index above the 1,770 level,” it said.
The research house said following the up close on Aug 15, there should be buying attempt with support pegged at 1,765.
“The analysis of overall market action on Aug 15 revealed that buying power was stronger than selling pressure.
“As such, the FBM KLCI would likely trade above the 1,773.66 level on Aug 16,” said AllianceDBS Research.
Based on corporate announcements and news flow yesterday, stocks in focus today may include the following: Malaysian Resources Corporation Bhd, OSK Ventures International Bhd, Batu Kawan Bhd, Kuala Lumpur Kepong Bhd, Xidelang Holdings Bhd, Petronas Gas Bhd, KLCC Property Holdings Bhd and Tenaga Nasional Bhd.