KLCI stages technical rebound, reverses earlier loss

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KUALA LUMPUR (Oct 12): The FBM KLCI staged a technical rebound today to snap its losing streak and rose 0.54% at mid-morning, reversing its earlier loss, lifted by index heavyweights Malayan Banking Bhd (Maybank) and Tenaga Nasional Bhd.

At 10am, the FBM KLCI rose 9.28 points to 1,717.77. The index had slipped to a low of 1,703.92 in early trade.

Gainers led losers by 341 to 222, while 276 counters traded unchanged. Volume was 641.99 million shares valued at RM439.48 million.

The top gainers included Heineken Malaysia Bhd, Carlsberg Brewery Malaysia Bhd, United Plantations Bhd, KESM Industries Bhd, Tenaga, Hong Leong Industries Bhd, SAM Engineering & Equipment (M) Bhd, Genting Bhd and Maybank.

The actives included Vortex Consolidated Bhd, Sapura Energy Bhd, Hibiscus Petroleum Bhd, Orion IXL Bhd, Gamuda Bhd, My EG Services Bhd and Borneo Oil Bhd.

The losers included British American Tobacco (M) Bhd, Hap Seng Consolidated Bhd, Malaysian Pacific Industries Bhd, Malaysia Airports Holdings Bhd, MCE Holdings Bhd, Cahya Mata Sarawak Bhd and MISC Bhd.

Asian shares appeared tentative on Friday, holding steady after a nine-day losing streak, but sentiment was frail after Wall Street shares crumbled and expectations of market volatility shot up to an eight-month high, according to Reuters.

Worries about the economic impact of a Sino-US trade war, a spike in US bond yields this week and caution ahead of earnings seasons are all cited as potential reasons behind the selloff, the biggest market rout since February, it said.

Hong Leong IB Research in a traders' brief said investors may persist with the selling activities as long as the Fed is having a hawkish outlook on the interest rate, which may translate into higher borrowing costs for corporates in the US.

"Also, the unsettled trade developments could pose further downside risk to the stock markets.

"On the local front, stocks are likely to extend the selling tone with renewed selling interest on Wall Street and we think oil and gas stocks could face selling activities on the back of the declining crude oil prices.

"However, investors could be looking into defensive stocks within the high yield counters under this weak market environment.

"Also, based on the hammer candle that has formed yesterday, the FBM KLCI could be due for mild technical rebound," it said.