Investors may find the opportunity to accumulate undervalued stocks in sectors such as banking, oil & gas, and solid consumer stocks as the local bourse trends lower, Malacca Securities said in a note.
Meanwhile, it said that the technology sector is expected to endure another round of selling given the steep slump in Nasdaq overnight.
Reviewing the local bourse, the stockbroking firm said that the FBM KLCI (-2.0%) extended its losses with all 30 key index components in the red, mirroring the weakness across the regional peers.
It said that the lower liners sank deeper, while all the 13 major sectors on the broader market remained in red with the technology sector (-5.7%) taking the biggest plunge.
Malacca Securities said that given the significant sell-off overnight on Wall Street, it believes there might be another selling wave prior to the US FOMC meeting, eventually impacting the local bourse negatively for the session. Brent oil price sustained above the USD120 per barrel mark amid an inflationary environment, while the CPO price is trading around RM5,800.
On the global market, Wall Street endured another volatile as session as the Dow (-2.8%) gapped down and finished lower amid the mounting concern over recessionary risk following the rising inflationary pressure that may speed up the pace of monetary tightening. Both the European and Asia stock markets also painted in the red.
