Mid Day Market Update: Better-Than-Expected 2Q GDP Pushes up KLCI

Bursa Malaysia ended the Friday morning session in slightly bullish note, the FBM KLCI edged slightly higher by 2.67 points to 1,508.23, from 1,505.56 at Thursday’s closing of 1,505.56.

The KLCI was lifted due to the better-than-expected GDP growth of 8.9% in the second quarter of 2022, which beats the forecasts of 5.5% to 6.5%, as the GDP number was propped by domestic demand. The higher economic growth was fueled by reopening of borders as the nation entered into endemicity. These have contributed to improved labour market and normalised activities.

On the broader market, decliners outnumbered gainers 395 to 306, while 371 counters were unchanged.

Trading volume registered at 1.134 billion units with value of RM787.5 million.

Amongst the best performers on Bursa Malaysia are, F&N, Texchem, Petronas Dagangan, Heineken Malaysia, Hong Leong Bank.

Whilst losers are, MPI, Hartalega, Kossan, SAM, Nestle and Pentamaster.

WTI Crude :  Immediate Rebound Blocked By The 200-Day SMA Line

RHB Research continued to maintain “short” positions on WTI Crude.

The WTI Crude jumped strongly towards the 200-day average line yesterday as it closed USD2.41 higher at USD94.34 – breaching above the USD93.50 resistance-turned-support. Despite opening lower at USD91.55, strong buying interest then emerged to propel the commodity northwards towards hitting the intraday high of USD95.05 before retracing retracing mildly at the close. The bullish candlestick blocked by the long-term average line indicates that, although the short-term rebound is imminent, the medium- to long-term bearish bias remains intact below the 200-day average line. This is supported by the “lower high” pattern that remains relevant, ie indicating a major downtrend movement. The bullish bias may be seen if the WTI Crude manages to form a “higher high” bullish pattern above the 200-day SMA line – breaching the USD99.99 resistance. Since the trailing-stop level has yet to be broken, no change to bearish bias.

COMEX Gold: Pulling Back Below The Immediate Resistance

Meanwhile, for this precious metal futures RHB Research is maintaining “long” positions.

The COMEX Gold pulled back mildly yesterday, as it consolidated below the immediate resistance. The commodity started off yesterday’s session at USD1,807.90. After moving between USD1,814.90 and USD1,798.60, it closed at USD1,807.20 – retracing USD6.50 from the previous session. We observed that the commodity is yet to break past the immediate resistance, but managed to retain its position above the 50-day SMA line. Meanwhile, the 20-day SMA line is trending higher, improving the bullish technical setup. In the event the commodity resorts to deeper retracement, it may correct towards USD1,787, followed by USD1,770. As long as it stays above the 20-day SMA line, the bullish structure will remain, and therefore – post consolidation – it should resume the upside movement. For now, the research house will keep its positive bias.

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