Bursa Malaysia has tracked higher in four straight sessions, advancing almost 35 points or 2.2 percent along the way.
The Kuala Lumpur Composite Index now sits just above the 1,495-point plateau and it may add to its winnings on Tuesday.
At 9.16am, the FBMKLCI rose +1.54 points to open at 1,497.17.
RHB Retail Research in a note today (Jan 9) said the FKLI sustained its upside movement for a fourth consecutive session yesterday, testing the 1,500-pt threshold during the intraday session.
Opening at 1,491.50 pts, its movement rose to the day’s high of 1,505 pts before a moderate retreat closing at 1,498.50 pts.
The fourth consecutive session of bullish price action solidifies the technical setup towards the 1,500-pt level, as overall uptrend remains intact.
We observe the RSI has just entered the overbought territory at 72%, the index may experience short-term profit-taking.
As long as the index stay above the 1,450-pt support, we maintain a bullish trading bias.
The FBMKLCI (+0.54%) closed higher despite the mostly negative regional markets’ performance, as the bourse was supported by strong buying interest in construction and energy stocks.
On the broader market, the Construction sector (+1.54%) was the top gainer, while the Telco & Media sector (-0.36%) declined.
Global markets: Wall Street ended higher as, investors’ buying interest picked up in megacap stocks after the selloff last week, however investors will be eyeing the upcoming inflation data later this week. The European stock markets ended higher, while Asia ended lower, led by the bankruptcy of Chinese Zhongzhi Shadow Bank.
The Day Ahead
The FBMKLCI traded higher for the 4th session with solid buying interest within the Utilities and Banking heavyweights.
Meanwhile, Wall Street rebounded higher led by tech giants such as Amazon, Google, Apple and Nvdia after a brief decline in 10-year
US Treasury yield.
Apple had a solid uptick as it confirmed the sale of Apple Vision Pro by 2nd of February.
This week, traders will still be monitoring the inflation data namely the CPI and PPI to understand the direction of the interest rates going
forward.
On the commodity market, Brent oil price plunged more than 3% on the back of price cuts by Saudi Arabia, offsetting the rising geopolitical tensions in the Middle East.
Sectors focus: As the Utilities sector has been rallying strongly over the past few days, we expect profit taking activities to emerge. Meanwhile, the other sectors that have room to grow may include the Consumer, Transportation & Logistics, Technology sectors as well as the Industrial Products sector. We believe Building Material may benefit from the recent rally in Construction and Property sectors on the back of the KL-SG-HSR theme and the easing requirements of MM2H, while the heightened geopolitical tension in the Middle East could lift the shipping industry.
Bloomberg FBMKLCI Technical Outlook
The FBMKLCI ended higher, once again breaking the previous resistance level.
The technical readings on the key index were positive, with the MACD Histogram extending another positive bar, while the RSI maintained above the 70 level.
The resistance is envisaged around 1,500-1,510 and the support is set at 1,470-1,480.
CGSCIMB said most Asian stock markets finished lower on Monday with Hong Kong’s HSI (-1.88%) leading the declines.
The local benchmark FBMKLCI (KLCI) extended gains for the fourth consecutive session, adding 8.09pts or 0.54% to end the day
at 1,495.70.
The best performing sectors included construction (+1.54%), energy (+1.09%) and consumer products (+0.75%) whereas telecommunications (-0.36%) and property (-0.34%) were the only laggards.
Trading volume continued to hit a new high for the year, advancing to 6.96bn (up from 6.62bn on Friday) while trading value increased to RM4.21bn (up from RM3.74bn previously).
Market breadth stayed strongly positive five days in a row as 628 gainers beat 470 decliners.
The benchmark gapped up and cleared the 1,494 level yesterday, supported by continuing buying interest.
However, yesterday’s fifth white candle has lifted the market into the overbought region.
We would not be surprised if a pullback takes place over the course of the next couple of days.
The 1,500 psychological levels continue to act a magnet to draw prices higher but historically, the upcoming 1,500-1,510 levels have been a key resistance in the past 12-months or so.
The following resistance is seen at 1,527.
On the downside, the rising EMAs act as the immediate support which also includes the 1,450 level.
Our portfolio stays in risk-on mode this week.
