KLCI stays below 1,600 threshold, set to end week on subdued note

KLCI stays below 1,600 threshold, set to end week on subdued note
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KUALA LUMPUR (Jan 22): The main index at Bursa Malaysia remained below the 1,600 psychological threshold in early trade Friday and looked set to end the week on a subdued note.

At 9.05am, the FBM KLCI added 3.39 points to 1,598.19.

The early gainers included Carlsberg Brewery Malaysia Bhd, Malaysian Pacific Industries Bhd, Unisem (M) Bhd, ViTrox Corp Bhd, Public Bank Bhd, Pintaras Jaya Bhd, Supermax Corp Bhd, Euro Holdings Bhd and Hartalega Holdings Bhd.

Bloomberg said Asian stocks pulled back from an all-time high in early Friday trading as investors assessed earnings, prospects for stimulus and escalating coronavirus cases.

The dollar was on course to decline for its first week in three, it said.

Inter-Pacific Research Sdn Bhd said the FBM KLCI slipped below the 1,600 level yesterday on sustained funds’ profit taking/selling actions, extending its downtrend for a sixth straight session.

In its daily bulletin today, the research house said as it is, Malaysian equities continue to be affected by the lack of leads and direction, resulting in the increasingly insipid market environment with market breadth also decidedly negative.

It said the lower liners and broader market shares also succumbed to fresh selling pressure due in part to their already toppish conditions.

Inter-Pacific said Malaysian equities are looking increasingly precarious with few signs of a rebound as yet, hampered by concerns over the rising domestic Covid-19 cases that is likely to disrupt the economy and corporate earnings recovery in 1Q21.

“The extended movement control order could further leave sentiments guarded amid the increasingly adverse economic performance resulting from the latest lockdown.

“At the same time, support on the heavyweights is set to be shallower with the EPF possibly trimming more shares to meet the i-Sinar withdrawal needs.

“With the supports waning, we see the key index remaining pressured in the near term and the downside bias will linger. The 1,590 level is now the immediate support, followed by 1,580 level. On the other hand, the 1,600 level is the immediate resistance, followed by the 1,615-1,620 levels,” it said.

Inter-Pacific said after an extended overbought spell, the lower liner and broader market shares are also seeing increased profit taking/selling activities with the challenging economic and operating environment prompting more market players to retreat to the sidelines until there is more certainty.

“This is likely to preserve the near term downside bias and could result in indices like the FBM Small Cap, FBM ACE and technology ending the week on a subdued note,” it said.