KUALA LUMPUR: The FTSE Bursa Malaysia KLCI (FBM KLCI) could stage a technical rebound or in the near term, driven by local funds ahead of the widely-anticipated June window dressing and oversold position.
The FBM KLCI could see an upside bias to retest the 1,746 to 1,769 level in anticipation of the mid-year window dressing, said Hong Leong Investment Bank Research (HLIB Research).
“Having nose-dived seven per cent or 131 pts in six weeks from a high of 1,867 on April 27 to 1,729 on June 9, we might see some technical rebound in the near term,” it said in a note.
On potential proxies, HLIB Research is recommending Telekom, IOI Corp, DiGi.com, MISC and CIMB due to their grossly oversold positions and high local institutional shareholdings.
Meanwhile, Kenanga Research said the FBM KLCI was expected to find a temporary bottom near the 1,710 to 1,732 level.
“Thus, we believe it is a good time to nibble on selective stocks, especially those in resilient and export-oriented sectors, despite domestic and external uncertainties continuing to weigh down the market,” said the research house.
Affin Hwang Investment Bank vice-president and head of retail research, Datuk Dr Nazri Khan Adam Khan told Bernama that the current downtrend in the benchmark FBM KLCI presented a good buying opportunity for quality bluechips.
“I recommend investors to buy construction and technology stocks as they are major benefactors of the recently announced Eleventh Malaysia Plan,” he said.
For the week just ended, the FBM KLCI managed to snapped its losing streak as bargain hunting lifted the local market on Wednesday, in line with the recovery in key regional bourses.
On a Friday to Friday basis, the benchmark FBM KLCI shed 10.96 points to 1,734.37 from 1,745.33.
The FBM Emas Index decreased 107.04 points to 12,022.47, the FBMT100 Index shed 96.82 points to 11,707.04 and the FBM Emas Shariah Index went down 103.56 points to 12,547.22.
The FBM 70 declined 196.46 points to 13,236.08 and the FBM Ace dipped 297.24 points to 6,290.71.
Sector-wise, the Finance Index fell 51.70 points to 15,530.11, the Plantation Index trimmed 125.70 points to 7,366.88 and the Industrial Index eased 7.960 points to 3,196.56.
Weekly turnover declined to 6.36 billion units worth RM7.29 billion from 9.07 billion units worth RM11.63 billion previously.
Main market volume decreased to 4.08 billion units worth RM6.62 billion from 4.65 billion units worth RM8.17 billion last week.
Warrant turnover narrowed to 624.45 million units worth RM195.16 million from 743.11 million units worth RM248.03 million previously.
The ACE market declined to 1.65 billion shares worth RM472.91 million from 1.96 billion shares worth RM681.17 million previously. — Bernama