Bursa Malaysia bounced higher again on Friday, one session after halting the three-day winning streak in which it had rallied almost 40 points or 2.4 percent.
The Kuala Lumpur Composite Index now sits just beneath the 1,680-point plateau and it’s looking at another green light for Monday’s trade.
At 9.16am, the FBMKLCI rose +2.09 points to open at 1,680.36.
RHB Retail Research (RHB) in a note today (Sept 2) said the FKLI underwent strong positive price action during the last trading day of August, surging 33.50 pts to close stronger at 1,671.50 pts.
The index started trading at 1,638.50 pts.
After setting its foothold at the 1,634-pt session low, it climbed to the 1,671.50-pt session high before the close.
This latest long bullish candlestick reaffirmed that the bulls remain in the driver’s seat.
The RSI is also curving upwards, suggesting the positive price action should follow through during the coming sessions, possibly breaching the 1,673.50-pt resistance.
On the downside, should the FKLI resort to profit-taking, it may pull back towards the 50-day SMA line.
For now, the medium-term moving average line still acts as the downside support.
Pending a bullish breakout, they held on to the positive trading bias.
Malacca Securities (MSSB) said the FBM KLCI (+1.53%) closed higher, boosted by buying pressure in utility heavyweights, namely TENAGA (+70.0 sen), which benefited from stronger earnings amid to increased electricity sales and a favourable ringgit environment.
In the broader market, all sectors posted gains on the final day of August.
The Day Ahead
According to MSSB, the local exchange ended on a positive note, supported by window dressing activities on the final day of August.
They observed a broad-based rebound following selling pressure linked to the yen carry trade incident in early August.
Meanwhile, the US stock markets closed broadly higher in anticipation of a Fed interest rate cut in September, after the core PCE index met expectations at 0.2%.
This week, investors will focus on manufacturing and jobs data, which should provide insights into the health of economic activities.
In the commodity markets, Brent oil trended lower, dipping just below the USD77 level, while gold prices remained around USD2,500.
CPO prices continued their rebound, approaching the RM4,000 mark.
Sector Focus: Still, MSSB believed the broadly negative performance in the US technology stocks, coupled with the stronger ringgit environment may dampen the demand for local technology companies.
On the other hand, the elevated ringgit could boost trading activity in sectors such as Consumer, Banking, Construction, and Building Materials.
They also favoured selected O&G players following their strong earnings results.
Bloomberg FBMKLCI Technical Outlook
The FBM KLCI index ended higher towards the 1,678 level.
Also, the technical readings on the key index were positive with the MACD histogram forming another positive bar and the RSI trended above 50.
The resistance is envisaged around 1,693-1,698 and the support is set at 1,658-1,663.
CGS International (CGS) said Asian stock markets finished the month on a strong note.
The local benchmark FBMKLCI (KLCI) led the charge last Friday, soaring 25.25pts or 1.53% to end the day at 1,678.80.
The index surged 43.06pts or 2.63% week-on-week and 53.23pts or 3.27% month-on-month.
All sectors rallied for the day led by property (+3.45%), utilities (+3.05%) and technology (+2.17%).
Trading volume rose to 3.96bn (up from 3.68bn previously) while trading value advanced to RM6.22bn (up from RM3.97bn previously).
Market breadth turned positive as 771 gainers beat 421 decliners.
The benchmark rebounded and closed at a new 44-month high last Friday (since 2020’s high of 1,695) with a white bullish candle.
A cluster of resistances surrounding the 1,680-1,686 levels may cap near-term upside followed by the 1,700 psychological level.
Any pullback is viewed as a constructive move as long the KLCI stays above the 1,632-1,638 (May-July highs) levels – which remains
as support for now.
Their portfolio stays in risk-on mode this week.
