KLCI falls 0.71% as key index stocks retreat, investors eye economic recovery plan

KLCI falls 0.71% as key index stocks retreat, investors eye economic recovery plan
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KUALA LUMPUR (June 5): The FBM KLCI fell 0.71% in mid-morning today as key index-linked stocks fell ahead of the announcement on the nation's short-term economic recovery plan for the June to December 2020 period later today.

Investors will closely follow Prime Minister Tan Sri Muhyiddin Yassin’s scheduled announcement at 3pm today.

As at 10am, the KLCI had lost 11.13 points to 1,550.71.

Losers led gainers by 496 to 233, while 346 counters traded unchanged. Trading volume was 1.94 billion shares valued at RM1.25 billion.

The top losers included Hap Seng Consolidated Bhd, Dutch Lady Milk Industries Bhd, Hong Leong Financial Group Bhd, Public Bank Bhd, Aeon Credit Service (M) Bhd, QL Resources Bhd, Hong Leong Bank Bhd, Malaysia Airports Holdings Bhd (MAHB), Petronas Dagangan Bhd (PetDag) and Petronas Chemicals Group Bhd (PetChem).

The top actives included Sapura Energy Bhd, AT Systemization Bhd, Careplus Group Bhd, Ageson Bhd, Sanichi Technology Bhd and HLT Global Bhd.

The top gainers included Top Glove Corp Bhd, Supermax Corp Bhd, Hartalega Holdings Bhd and ViTrox Corp Bhd.

Bloomberg said Asian stocks opened mixed today amid concern the recent rally had gone too far, with another big drop in American payrolls looming from the May employment report.

Japanese and Australian shares dipped when trading began, while those in South Korea were slightly higher. Contracts on the S&P 500 were little changed after the index snapped a four-day winning streak yesterday. Ten-year Treasury yields held near the highest level since March. The euro earlier surged after the European Central Bank (ECB) announced a bigger-than-expected boost to its emergency bond-buying programme, it said.

Hong Leong Investment Bank Research said after surpassing the key 200-day simple moving average and long-term downtrend line from the all-time high of 1,897 points, the liquidity-driven bulls are in control to lift the KLCI to another leg-up towards the 1,560-1,600 psychological barriers as investors cling to optimism about a gradual reopening of economies from Covid-19 lockdowns, supported by unprecedented fiscal and monetary stimulus as backstops.

“However, given the grossly overbought RSI (Relative Strength Index) and slow stochastic readings, the index may undergo a healthy pullback towards 1,518/1,500/1,480 levels in the short term,” it said.