KUALA LUMPUR: Bursa Malaysia is expected to consolidate in the absence of lack local leads, smaller cap stocks breather, overextended broad market rally, concerns over sluggish growth in Europe and renewed Ukraine-Russia tension.
Affin Investment Bank vice-president and head of Retail Research Dr Nazri Khan Adam Khan said escalating concerns over the situation in Ukraine has reintroduced a short-term element of risk aversion into the market.
“Equity market sentiment is showing a short-term downturn, following weakness in Europe and growing geopolitical risks out of Ukraine,” he told Bernama.
However, he said from a fundamental stand point, positive fundamentals remained intact with an accommodative central bank monetary policy, huge international reserves, steady ringgit and relatively tame inflation should provide limited downside risk.
“Overall, we expect short-term weakness over the holiday shorten session, but beyond that we believe there are positive factors to inspire more round of accumulation over the medium-term.
“We are pegging the immediate support at the psychological 1,860 and 1,840 (20-day and 200-day moving average) level while immediate resistance stands at 1,890 (50-day moving average) and 1,900, which is near the all-time record high,” he said.
He added that the local index was holding a respectable 5.8 per cent gain since early February.
Overseas, he said European stocks took a bigger hit, reflecting concerns about the region’s much greater exposure to Russia.
He said major European stock indices were lower across the board with an added drag coming from lacklustre corporate earnings and ideas that the European Central Bank could hold off on further easing measures at next week’s meeting.
For the week-just-ended, the FBM KLCI declined 4.88 points to 1,866.11 from 1,870.99 last Friday.
The Finance Index rose 19.89 points to 17,466.32, the Industrial Index decreased 17.29 points to 3,242.98 and the Plantation Index dropped 62.72 points to 8,527.57.
The FBM Emas Index was 87.15 points lower at 12,995.11, FBMT100 Index eased 65.06 points to 12,582.95, the FBM 70 shed 197.01 points to 14,173.46 and the FBM Ace fell 169.91 points to 6,903.7.
Weekly turnover fell to 15.18 billion shares, valued at RM11.57 billion, from 22.67 billion shares, worth RM13.40 billion, recorded last week.
Main market volume decreased to 10.92 billion units, worth RM10.67 billion from last week’s 18.39 billion units, worth RM12.64 billion.
Warrants turnover decreased to 213.89 million units, valued at RM29.06 million from 370 million units, valued at RM54.1 million, registered last week.
The ACE market volume increased to 3.98 billion shares, worth RM846.04 million, from 3.8 billion shares, worth 687.8 million, transacted previously. — Bernama