KLCI may trend sideways, but no fresh catalyst in sight

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KUALA LUMPUR (Aug 11): The FBM KLCI could trend sideways today on some mild bargain hunting after the battering Monday, in line with the general recovery in overnight trade at most global markets and Wall Street.

Slowing demand in China led some stock markets to rise on Monday, on hopes of more policy stimulus, but commodity prices fell, according to Reuters.

China's stock markets ignored caution in Asian equities, with major indices up between 2% and 4%. European trading got off to a subdued start as mining and energy stocks kept UK shares performing worse than the euro zone's, it said.

Meanwhile, US stocks climbed on Monday, giving the S&P 500 its biggest increase since May as indexes rebounded sharply from last week's losses, buoyed by gains in commodity-related shares and optimism over Warren Buffett's latest deal, said Reuters.

Stocks on Bursa Malaysia may find some respite after the battering on Monday and trend sideways today as bargain hunting could help stop the downtrend, although not absolutely as local investor sentiment remains wary still.

However, with no immediate catalyst in sight, compounded by the weak ringgit as well as public unease over local politics, the Malaysian stock market is at a vulnerable state and may still some overall weakness.

The rinngit was quoted at 3.9365 to the US dollar in electronic trading this morning.