KUALA LUMPUR (July 15): The FBM KLCI is expected to extend its gains albeit limited ahead of the extended weekend with the Hari Raya holiday mood already setting in.
Stock markets worldwide rose modestly on Tuesday after a landmark nuclear deal between Tehran and six global powers left sanctions on Iran in place for now, spurring gains in energy shares, while expectations for weak corporate results capped U.S. share gains, according to Reuters.
Brent and U.S. crude reversed losses which came after the nuclear deal was reached. The deal, which is set to ease sanctions against Tehran and allow a gradual rise in its oil exports, had initially sent oil prices tumbling, it said,
AllianceDBS Research in its evening edition Tuesday said the FBM KLCI had on July 14 gapped up to reach a high of 1,727.07 as market participants continued to play on the buying side in anticipation of a higher market.
The research house said under the supportive buying interest, the benchmark index was in the green throughout the trading sessions before settling near the day’s low 1,721.10 (+ 4.99, + 0.29%).
“In the broader market, gainers outnumbered losers with 477 stocks ending higher and 287 stocks finishing lower. That gave a market breadth of 1.66 indicating the bulls were in control,” it said.
AllianceDBS Research said buyers were again in better control over the sellers on July 14, adding this could be seen from the higher high and upside gap created.
The research house said the market development over the past 4 days was encouraging amid overall weak sentiments.
“However, it was accompanied by declining volume.
“Following the weak up close, the benchmark index is likely to test a higher level again with an immediate hurdle seen at 1,728.
“A crossover of 1,728 should see the market gearing towards the next overhead resistance at 1,739,” it said.
AllianceDBS Research said the immediate market support was at 1,706.
The research house said that indicator wise, the MACD was above the 9-day moving average line.
“The analysis of overall market action on July 14 revealed that buying power was stronger than selling pressure.
“As such, the FBM KLCI would likely trade above the 1,727.07 level on July 15,” said AllianceDBS Research.