KLCI rises 0.81% on firm technical rebound

KLCI rises 0.81% on firm technical rebound
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KUALA LUMPUR (Feb 4): The FBM KLCI rose 0.81% at mid-morning today, staging a firm technical rebound after having been sold down heavily since the outbreak of the Wuhan virus in China that rattled global equity markets.

At 10am, the FBM KLCI rose 12.58 points to 1,534.53.

Gainers led losers by 451 to 157, while 257 counters traded unchanged. Volume was 759.68 million shares valued at RM378.93 million.

The top gainers included Nestle (M) Bhd, Fraser & Neave Holdings Bhd, Carlsberg Brewery Malaysia Bhd, LPI Capital Bhd, United Plantations Bhd, Heineken Malaysia Bhd, Kuala Lumpur Kepong Bhd, KESM Industries Bhd and Public Bank Bhd.

The actives included AirAsia Group Bhd, mTouche Technologies Bhd, Bumi Armada Bhd, Tiger Synergy Bhd, Alam Maritim Resources Bhd and Mudajaya Group Bhd.

The decliners included IGB Bhd, Syarikat Takaful Malaysia Keluarga Bhd, Scientex Bhd and Malaysia-listed Hang Seng Index-linked put warrants.

Reuters said a fragile calm gripped Asian shares on Tuesday as investors waited anxiously to see if Beijing could stem the rout in Chinese assets, while oil hit 13-month lows as the coronavirus throttled demand in the world's biggest importer of fuel.

Brent crude futures crashed to US$54.11 a barrel, bringing losses for the year so far to 18%, while US crude sank to US$49.99, it said.

Hong Leong IB Research said although Wall Street managed to rebound mildly yesterday, persisting worries on the Wuhan coronavirus (China's death toll has surpassed SARS outbreak during 2002-2003) could still dampen the stock markets moving forward.

"Nevertheless, traders may still focus on the ongoing reporting season in the US. The Dow's trading range will be set around 28,000-28,800.

"Given the rebound in overnight Wall Street, coupled with the injection of liquidity by PBoC (People's Bank of China) into the markets, we believe it would cushion the downside tone on regional markets and the FBM KLCI could be due for a technical rebound (as ADX [Average Directional Index] component - negative DMI [Directional Movement Index] has surged above 40, suggesting an oversold condition).

"Traders could look out for oversold technology and O&G stocks for trading opportunities," it said.