Friday 29 Mar 2024
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KUALA LUMPUR (Feb 15): The FBM KLCI is expected to trend sideways and extend its consolidation phase today despite the rebound last Friday at most global markets.

US and European shares rebounded from recent weakness on Friday, with reassuring US retail sales data boosting sentiment, while US crude prices rallied from more than 12-year lows, according to Reuters.

Banking shares in the US and Europe spiked, with the S&P financial index closing up 4% and the STOXX 600 Europe Banks index gaining 5.6%, it said.

AllianceDBS Research in its evening edition last Friday said despite the down close in the preceding day, the FBM KLCI had on Feb 12 traded higher at 1,648.70 as market participants took the chance to play a buying game.

The research house said that in the absence of stronger selling interest, the benchmark index was in the green throughout most of the trading sessions before settling off the day's high at 1,643.74 (down 0.21 points or 0.01%) ahead of weekend.

"In the broader market, losers outnumbered gainers with 517 stocks ending lower and 271 stocks finishing higher. That gave a market breadth of 0.52 indicating the bears were in control," it said.

AllianceDBS Research said the higher high on Feb 12 may have indicated the presence of supportive buying interest, but the market is likely to move between 1,630 and 1,672 for a little while given the way FBM KLCI carried itself in the last in the last eight days.

The research house said buyers and sellers are thus expected to continue exchanging their stock positions in an attempt to win the battle over the other.

"Based on a preliminary study of recent market movement, buyers were still seen having an upper hand over the sellers at this juncture.

"Market should gear towards the 1,672 level. However, a market reversal to break below 1,630 could send the index down the subsequent support zone, 1,609-1,618," it said.

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

"The analysis of overall market action on Feb 12 revealed that buying power was weaker than selling pressure.

"As such, the FBM KLCI would likely trade below the 1,638.50 level on Feb 15," said AllianceDBS Research.

Based on corporate announcements and news flow last Friday, companies likely to be in focus today include AmFIRST Real Estate Investment Trust, Excel Force MSC Bhd, Yen Global Bhd, Warisan TC Holdings Bhd, Sona Petroleum Bhd, Sunway Bhd, Tenaga Nasional Bhd, Malakoff Corporation Bhd and Maxwell International Holdings Bhd.

 

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