KUALA LUMPUR: Bursa Malaysia is expected to stage an oversold rebound, driven by the dovish Federal Reserve’s stance and positive performance of global stocks, alongside the ringgit’s recovery.
Affin Hwang Investment Bank vice-president and head of Retail Research Datuk Dr Nazri Khan said the benchmark FTSE Bursa Malaysia KLCI traded sideways last week, but ended the week marginally higher.
The index is still trapped in a downtrend channel due to the lack of fresh catalysts, while key indicators are also showing lethargic signs, despite being in their respective oversold region.
“We continue to see the FBM KLCI as being oversold, and therefore, should see a mild rebound led by selected depressed quality counters,” he told Bernama.
Last week, the trading session ended marginally higher, mainly led by bargain hunting gains in battered stocks such as Maybank, CIMB, Tenaga, Axiata and Airasia, Nazri said.
“Foreigners, finally ended their selling spree, with a record year-to-date (YTD)outflow streak of 21-days.
“They started to snap up blue chips and bought RM1.1 billion worth of shares to bring the YTD net outflows to RM7.4 billion,” he added.
He said however, the market is expected to remain highly volatile due to bond yield movement, concerns on China’s crackdown on margin lending, the rising Greece debt default risk and untimely local government-linked issues.
He said three major local stories are expected to propel Bursa Malaysia moderately higher.
They are, Bank Negara Malaysia’s reiteration on the country having a high monetary and financial stability to boost the Ringgit and support sustainable economic growth, the Ministry of International Trade and Industry maintaining that Malaysia will prosper under Asean economic integration model and Petronas’ pledge to mitigate the negative impact on oil gas stocks on Bursa Malaysia, which are under pressure from crunching business concessions.
On a Friday-to-Friday basis, the benchmark FBM KLCI shed 12.6 points to 1,721.77 from 1,734.37.
The FBM Emas Index decreased 115.66 points to 11,906.81, the FBMT100 Index shed 110.26 points to 11,596.78,the FBM Emas Shariah Index fell 170.46 points to 12,376.76, as the FBM 70 declined 220.42 points to 13,015.66.
The FBM Ace added 9.29 points to 6,300.
Sector-wise, the Finance Index rose 62.84 points to 15,592.95.But the Plantation Index trimmed 63.6 points to 7,303.28 and the Industrial Index eased 35.67 points to 3,160.89.
Weekly turnover increased to 7.72 billion units worth RM9.18 billion from 6.36 billion units worth RM7.29 billion previously.
Main market volume improved to 4.91 billion units worth RM8.31 billion from 4.08 billion units worth RM6.62 billion.
Warrant turnover widened to 790.35 million units worth RM213.03 million from 624.45 million units worth RM195.16 million.
The ACE market advanced to 2.01 billion shares worth RM655.54 million from 1.65 billion shares worth RM472.91 million. — Bernama