KLCI likely to extend lacklustre run

-A +A

KUALA LUMPUR (Jan 5): The FBM KLCI is likely to extend iots lacklustre run today due to lack of fresh catalysts as well as still dipping crude oil prices that have kept global investors on tenterhooks.

The euro fell on Friday, continuing the slide that saw the currency finish out 2014 at a 29-month low against the U.S. dollar, on expectations that the European Central Bank will soon embark on outright money-printing, according to Reuters.

Crude prices fell in a volatile session, while equities as measured by a global index lost ground.

Wall Street's equity benchmark ended a choppy day barely changed, with gains in energy and high-dividend stocks offsetting declines in consumer-centered shares.

The S&P 500 on Wednesday closed out trading for 2014 with a third consecutive year of double-digit percentage gains, though it ended about 1 percent below its all-time closing high, said Reuters.

At the local market, which lost more than RM6.8 billion to foreign fund outflow by Christmas last year, the mood is likely to continue to be sombre with not much exciting news in sight.

At best, penny stocks may attract interest on bargain hunting activities for battered stocks, with analysts expecting a choppy first half in 2015.

JF Apex Securities Research has revised downwards its end-2015 target for the FBM KLCI to 1,720 points from 1,930 previously, saying the local stock market will continue to exhibit choppy trade as long as crude oil price stays sluggish and the ringgit continues to weaken against the US dollar.

In a strategy note Jan 2, the research house said foreign selling would re-emerge whenever there was a concern on the slump in oil price which could trigger the country’s fiscal budget and current account deficits.