Friday 29 Mar 2024
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KUALA LUMPUR (Dec 7): The FBM KLCI is expected to remain cautious and trend sideways today with immediate support at the 1,660-point level.

Stocks on Wall Street rallied on Friday after strong jobs data made it almost certain the Federal Reserve would raise interest rates in two weeks, while a surprise move by major oil exporters to keep pumping near-record output pushed crude prices down, according to Reuters.

The dollar rose, gold climbed about 2 percent and base metals, including copper, gained after the U.S. jobs report for November paved the way for the Fed to raise rates for the first time in nearly a decade at a two-day meeting that ends Dec. 16, it said.

AllianceDBS Research in its evening last Friday said that dampened by the down close in the preceding day, the FBM KLCI had on Dec 4 opened on a weak note as market participants continued to play on the selling side in anticipation of lower market.

It said under the persistent selling pressure, the benchmark index  traded down to 1,667.14 and kept its position in the red throughout the trading sessions before settling near the day’s low at 1,667.87 (down 6.05 points or 0.36%).

“In the broader market, losers outnumbered gainers with 424 stocks ending lower and 347 stocks finishing higher. That gave a market breadth of 0.81 indicating the bears were in control,” it said.

AllianceDBS Research said the lower low on Dec 4 indicated that sellers were in better control over the buyers.

“Given the market action over the past 3 days, buyers are still seen unwilling to commit on the buying side in the absence of positive catalyst as they do not want to make wrong investing decision only to see later that their investible capital are stuck in a low market volatility environment.

“Following the down close on Dec 4, the FBM KLCI is expected to test lower level again with immediate support seen at 1,660.

“A fall below 1,660 could send the index down to the subsequent support zone, 1644 – 1,656,” it said.

The research house said the overhead resistance was pegged at 1,677, adding that indicator wise, the MACD was marginally below the 9-day moving average line.

“The analysis of overall market action on Dec 4 revealed that buying power was weaker than selling pressure.

“As such, the FBM KLCI would likely trade below the 1,667.14 level on Dec 7,” said AllianceDBS Research.

 

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