KUALA LUMPUR (Dec 13): The FBM KLCI is expected to trend higher today in line with the positive overnigt close at most global markets, with immediate hurdle at 1,730 points.
Major European stock indexes closed higher on Tuesday as the S&P and the Dow advanced further into record territory, while Brent crude oil slipped after reaching $65 per barrel for the first time since mid-2015, according to Reuters.
Mergers and acquisitions helped boost European stocks, with the pan-European STOXX 600 index up 0.66 percent, it said.
The Dow Jones Industrial Average last rose 155.21 points, or 0.64 percent, to 24,541.24, the S&P 500 gained 8.72 points, or 0.33 percent, to 2,668.71 and the Nasdaq Composite dropped 6.98 points, or 0.1 percent, to 6,868.10, said Reuters.
AllianceDBS Research in its evening edition Tuesday said that dampened by the down close in the preceding day, the FBM KLCI had on Dec 12 traded lower to 1,717.32 as market participants continued to play on the selling side.
However, it said weak follow through selling interest in the area of 1,717.32 prompted supportive buying interest to chip in.
It said this lifted the benchmark index to settle at the day’s high of 1,729.57 (up 10.10 points or 0.59%) in the last few minutes buying of selective blue chip stocks.
“In the broader market, gainers outnumbered losers with 500 stocks ending higher and 372 stocks finishing lower. That gave a market breadth of 1.34 indicating the bulls were in better control,” it said.
AllianceDBS Research said the market made a lower low on Dec 12 with the benchmark index touching a low of 1,717.32.
“As compared to the previous day’s low of 1,718.30, this marginal decline suggested that market participants were unwilling to play an aggressive selling game on an immediate basis.
“Since the small consolidation platform between the 1,713 and 1,730 levels on chart basically indicated an equality of the on-going demand and supply forces.
“Buyers and sellers would still be seen engaging in a tug-of-war game until we see a breakout of the market range. For an upward move, new buying interest could only be generated if we see a crossover of 1,730,” it said.
The research house said the market should not stay in this range for long because many market participants did not want to see their invested monies being locked in without returns.
It said following the up close on Dec 12, there should be buying attempt with immediate hurdle at 1,730.
It said a crossover of 1,730 would see the market gearing towards the next resistance at 1,750.
“The analysis of overall market action on Dec 12 revealed that buying power was stronger than selling pressure.
“As such, the FBM KLCI would likely trade above the 1,729.57 level on Dec 13,” said AllianceDBS Research.
Based on corporate announcements and news flow yesterday, stocks in focus today may include: Rhone Ma Holdings Bhd, UEM Sunrise Bhd, Cocoaland Holdings Bhd, Kuala Lumpur Kepong Bhd, AEON Co (M) Bhd, Magni-Tech Industries Bhd, Anzo Holdings Bhd, Fajarbaru Builder Group Bhd, Pos Malaysia Bhd, Scomi Energy Services Bhd, Malaysia Airports Holdings Bhd and Maxwell International Holdings Bhd.