KLCI bucks regional trend, remains in the red as blue chips drag

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KUALA LUMPUR (July 4): The FBM KLCI bucked the regional trend at mid-morning today, as losses in select index-linked blue chips kept the local index in the red.

At 10am, the FBM KLCI shed 2.75 points to 1,687.30.

Gainers led losers by 297 to 188, while 285 counters traded unchanged. Volume was 864.32 million shares valued at RM278.90 million.

The top losers included Petronas Gas Bhd, Hong Leong Financial Group Bhd, Tenaga Nasional Bhd, Hong Leong Bank Bhd, Heineken Malaysia Bhd, Rapid Synergy Bhd and BIMB Holdings Bhd.

The actives included Sumatec Resources Bhd, XOX Bhd, Pegasus Heights Bhd, Malayan Flour Mills Bhd, KNM Group Bhd and Jaks Resources Bhd.

The gainers included Yinson Holdings Bhd, KESM Industries Bhd, Genting Plantations Bhd, Pentamaster Corp Bhd, Rhone Ma Holdings Bhd and AirAsia Group Bhd.

Asian stocks advanced on Thursday, tracking sharp gains on Wall Street as recent data from multiple sectors pointed to slowing economic growth in the United States, bolstering the prospect of rate cuts by the Federal Reserve, according to Reuters.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.3% as did Japan's benchmark Nikkei , and Australia was up 0.6%. A U.S. public holiday kept activity somewhat subdued, it said.

Hong Leong IB Research said currently, market participants are pricing in potential interest rate cut by the Fed later this month and it is likely to boost market higher on Wall Street over the near term.

“However, should any slowdown in the economic data moving forward, profit taking activities may emerge and it may limit the upside potential.

“Meanwhile, policies and statements from President Trump in regards of the trade issues with its trading partners could be another factor that may increase near term volatility in the markets. The Dow’s resistance is pegged around 27,500.

“Tracking new highs on Wall Street, coupled with the foreign trade flow turning positive over the past 5 trading days, it could lift market sentiment across Asia’s key stock markets, eventually leading the FBM KLCI higher.

“Also, we noticed the shift of trading momentum back towards construction as the sub-index has been trending higher recently. Nevertheless, we expect the upward momentum on the broader market may be limited after the recent rebound and the KLCI’s upside will be envisaged around 1,730,” it said.