KUALA LUMPUR (Oct 26): The FBM KLCI remained listless on Tuesday despite Covid-19 case spikes in the region and record earnings seen in the US.

The benchmark index closed 3.74 points or 0.24% lower at 1,584.2 after opening at 1,588.04, reaching an intraday high of 1,589.11 and dropping to a low of 1,583.07.

Overall market breadth was negative with 419 gainers outnumbered by 589 losers, and 444 counters were unchanged.

Some 3.83 billion shares worth RM2.37 billion were traded on Tuesday compared to Monday’s 3.88 billion shares worth RM2.46 billion.

Rakuten Trade head of equity sales Vincent Lau said the market is currently in a consolidation phase as investors are trading cautiously ahead of Friday’s budget announcement. 

“You could say that the market is somewhat listless, it is waiting for a strong catalyst to give it direction. We do not really see an underlying theme in the markets for this week,” he said.

He added that regional developments relating to Covid-19 case spikes in Singapore and China are priced in and unlikely to present themselves as a shock to the markets. Lau also noted that the world is progressively reopening itself back to pre-pandemic activity, especially in Malaysia where the usual footfall has returned after a 1.5-year lockdown.

On what sectors to focus on for the Budget, Lau suggested that the construction sector will likely benefit from the expansionary nature of the budget, along with the telecommunications sector through the deployment of 5G networks through JENDELA next year. 

Besides that, he also suggested that technology, renewable energy and electric vehicle-related companies will likely do well despite the Budget announcement but government incentives will increase their upside.

On the technical reading, Lau said the resistance for the benchmark index is still at 1,600 points while the support is at 1,580 so any movements in the short term will depend on whether the index constituents can benefit from the budget.

The top value gainers on Tuesday were Genetec Technology Bhd, Khind Holdings Bhd, and Nestle (Malaysia) Bhd, while the top value losers were PMB Technology Bhd, Petronas Dagangan Bhd, and Kuala Lumpur Kepong Bhd. The most actively traded stock was Key Alliance Group Bhd with 206.58 million shares changing hands.

Elsewhere in the region, Singapore’s Straits Times Index gained 0.08%, Hong Kong’s Hang Seng Index declined 0.36%, while Japan’s Nikkei 225 gained 1.77%.