KUALA LUMPUR: The FBM KLCI edged higher at midday, supported by gains in banking stocks, amid cautious investor sentiment.
The FBM KLCI rose by 6.09 points, or 0.38%, to 1,597.50 after reaching an intra-morning high of 1,601.90.
Market breadth is negative as losers overpowered the gainers on a ratio of 513-to-338 stocks. Traded volumes stood at 1.5 billion shares valued at RM1bil.
Among the gainers, Nestle jumped 66 sen to RM97.66, Malaysian Pacific Industries
rose 40 sen to RM25.60, SAM Engineering added 23 sen to RM4.40 and UWC climbed 17 sen to RM3.27.
United Plantations tumbled RM1.30 to RM30.52, Gamuda slid 16 sen to RM4.62, MBM Resources fell 16 sen to RM6.04 and KLCC lost 14 sen to RM8.07.
TA Research said the prevailing negative technical momentum and trend indicators on the FBM KLCI, following last week's choppy downward bias trade, suggest further downside correction before the market attempts to recover.
“Window dressing gains, which may materialise toward the end of the year, however, should stall further downside,” it said.
Meanwhile, market sentiment could be dampened by the US Fed's cautious approach to further rate cuts next year, implying they would stay elevated for longer, as well as by fears of a possible US government shutdown this week.
“As for the index, immediate chart support stays at 1,588, which is the 38.2% Fibonacci retracement (FR) of the rally from 1,529 low (Aug 6) to 1,684 high (Aug 29 Aug), with next crucial support at 1,565, the 23.6% FR level, followed by the key 1,550 support.
“Immediate resistance remains at the overhead 100-day moving average currently at 1,626, next will be at 1,648, the 76.4% FR level, followed by the September peak of 1,675,” TA said.
Meanwhile, Malacca Securities anticipates that buying interest will likely remain concentrated in export-oriented sectors such as technology and gloves.
This expectation stems from the Federal Reserve's more hawkish stance toward 2025, coupled with the anticipated sustained strength of the US dollar.
“Additionally, we remain positive on stocks linked to the data center supply chain, including those in the construction, utility, and building material sectors. Investors should also note that the KLCI index additions and deletions take effect today,” it added.
