Thursday 28 Mar 2024
By
main news image

KUALA LUMPUR (Oct 22): The FBM KLCI is likely to see limited gains today in line with the overnight drag at most global markets.

U.S. stocks indexes slipped on Wednesday on a tumble in healthcare and energy stocks, while oil prices slumped after U.S. government data showed a rise in crude inventories, adding to worries about oversupply, according to Reuters.

Gloomy quarterly earnings reports dragged on European shares, but were offset by hopes for ongoing central bank support for the economy ahead of a European Central Bank meeting on Thursday, it said.

AllianceDBS Research in its evening edition Wednesday said the FBM KLCI had on Oct 21 fallen below the 1,700 level to reach a low of 1,695.38 after opening the day on a weak note as market participants chose to play on the selling side in anticipation of a lower market.

However, the research house said non-follow through selling pressure in the area of 1,695.38 attracted renewed buying interest which lifted the market back up to settle at 1,707.11 (up 2.08 points or 0.12%).

“In the broader market, gainers outnumbered losers with 537 stocks ending higher and 310 stocks finishing lower. That gave a market breadth of 1.73 indicating the bulls were in control,” it said.

AllianceDBS Research said the benchmark index saw follow through selling pressure to a low of 1,695.38 after the opening bell on Oct 21 but risk taking market participants lent a helping hand to pull the market back up above the 1,700 level.

“The market settlement of 1,707.11 on Oct 21 was unexpected given the weak down close in the preceding day.

“The intraday downside breakout of 1,700 followed by a settlement above the 1,700 level on Oct 21 indicated the availability of supportive buying interest.

“However, the benchmark index must not fall back below the 1,695 level again because market participants may see the second downside breakout of 1,700 as a sign of more weakness ahead,” it said.

AllianceDBS Research said a fall below 1,695 would put pressure on the market down to the subsequent support at 1,680, adding that the hurdle was at 1,716.

It said that indicator wise, the MACD was still above the 9-day moving average line.

“The analysis of overall market action on Oct 21 revealed that buying power was stronger than selling pressure.

“As such, the FBM KLCI would likely trade above the 1,710.25 level on Oct 22,” said AllianceDBS Research.

 

      Print
      Text Size
      Share