Budget 2021, OPR decision, US election expected to be Bursa's key movers next week

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KUALA LUMPUR (Oct 31): Bursa Malaysia will be in a bearish mode next week pending the Budget 2021 announcement on Friday. 

An analyst said that technical analysis on the benchmark FBM KLCI has shown a three black crows pattern, which indicates a further bearish momentum. 

“The Relative Strength Index (RSI) for the FBM KLCI is currently at 14, below the RSI of 30, which signals an oversold position. 

“However, pending local development, the momentum could either turn upward or further downward after the budget tabling on Friday,” she said. 

Investors would also await the interest rate decision by the Monetary Policy Committee (MPC) on Tuesday (Nov 3) as well as Malaysia’s unemployment data and industrial production to be released on Nov 9.

She added that besides the budget tabling and MPC meeting, the US presidential election which will take place on Nov 3 will also influence market movement especially emerging markets. 

On the technical benchmark, the FBM KLCI is expected to move in a volatile manner between 1,430 and 1,470 pending the announcement of the budget.

On a Friday-to-Friday basis, the local bourse witnessed heavy selling on the ACE Market, leading the index to decline almost 11% to 9,443.20 due to local market uncertainty.

On Friday, the market took the biggest slide across board with the FBM KLCI tumbling 28.31 points or 1.89% after a steady decline over the week.

During the week, the market was directly influenced by the local political scenario, concerns over Budget 2021, calls for fresh elections to be held once Covid-19 is under control, oil market dip as well as global market movements.

The market was closed on Thursday in conjunction with Maulidur Rasul.

The FBM KLCI ended 27.75 points lower this week at 1,466.89 compared with 1,494.64 on Friday last week.

On the scoreboard, the FBM Emas Index shrank 213.65 points to 10,613.58, the FBMT 100 Index contracted 208.0 points to 10,423.63 and the FBM Emas Shariah Index weakened 212.43 points to 12,741.68.

The FBM 70 shed 273.25 points to 13,985.09.

Sector-wise, the Financial Services Index declined 349.77 points to 12,009.39 and the Plantation Index eased 53.10 points to 6,801.90 while Industrial Products and Services Index inched down 3.22 points to 141.14.

The Technology Index slid 1.09 points to 59.69 while the Healthcare Index slashed 38.49 points to 3,083.37.

During the holiday-shortened week, weekly turnover declined to 21.09 billion units worth RM16.16 billion from 42.67 billion units worth RM25.89 billion last week.

Main Market volume dwindled to 11.43 billion shares worth RM12.94 billion from 23.18 billion shares valued at RM20.43 billion.

Warrants turnover was lower at 2.84 billion units worth RM735.43 million compared to 4.06 billion units worth RM988.80 million in the preceding week.

The ACE Market volume also skidded to 6.80 billion worth RM2.48 billion from 14.66 billion shares valued at RM4.22 billion previously.