Bursa Malaysia has moved lower in three straight sessions, slipping more than a dozen points or 0.8 percent along the way.
The Kuala Lumpur Composite Index now sits just above the 1,660-point plateau and it may continue to spin its wheels again on Friday.
At 9.15am, the FBMKLCI rose +4.62 points to open at 1,669.47.
Malacca Securities (MSSB) in a note today (Sept 6) said that the FBM KLCI (-0.32%) extended its losses, dragged down by selling
pressure in YTL-related counters due to one of its subsidiaries being questioned by the Malaysian anti-graft agency; in line with the overnight US market performance in view of softer US economic growth going forward.
The Day Ahead
The negative sentiment persisted on the local front, leading to another round of broad-based sell-offs, with the technology sector being hit the hardest as the AI-driven rally fizzled out following Nvidia’s weaker guidance.
Meanwhile, U.S. stock markets ended on a mixed note as August private payrolls grew by only 99k, the smallest increase since 2021 and well below the consensus estimate of 140k, signalling a weakening labour market.
Looking ahead, traders will be closely monitoring the non-farm payroll report due later tonight, which could influence the extent of the interest rate reduction at the upcoming FOMC meeting.
In the commodity markets, Brent oil remained below USD73 due to softer demand from China and the US, despite OPEC+ delayed a production hike for Oct and Nov.
Gold prices remained above the USD2,500 level, and CPO prices hovered above RM3,900.
Sector Focus: They expected sentiment to remain negative on the local front, particularly within the technology sector, as the strong ringgit environment could lead to softer earnings going forward.
Conversely, they favoured select stocks within the Consumer, Construction, Building Materials, and Utilities sectors, which may benefit from the elevated ringgit.
Additionally, they believed investors may focus on fundamentally solid companies with high dividend yields, given the current oversold conditions.
Bloomberg FBMKLCI Technical Outlook
The FBM KLCI index ended lower towards the 1,664 level.
However, 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 1,679-1,684 and the support is set at 1,644-1,649.
Maybank Investment Bank (Maybank) said the KLCI ended lower for the fourth consecutive day.
Profittaking dominated trading in the afternoon session, reversing early gains.
At day’s end, the KLCI fell 5.42pts, or 0.32%, to close at 1,664.82pts.
Leading the decliners were YTL, YTLPOWR and SUNWAY.
Market breadth was negative, with losers outnumbering gainers by 796 to 323.
A total of 3.30b shares worth MYR3.43b changed hands.
The KLCI will remain cautious on the last trading day of the week.
All eyes are on the US unemployment data and non-farm payrolls, which could determine the magnitude of a potential Fed rate cut in September.
Technically, they expected the benchmark index to range between 1,655pts and 1,675pts today, with supports at 1,623pts and 1,596pts.
CGS International (CGS) said that Asian stock markets finished mixed on Thursday amid a slowdown in US labour data.
The local benchmark FBMKLCI (KLCI) lost 5.42pts or 0.32% to end the day at 1,664.82.
Most sectors closed in the negative territory barring transportation (+0.44%), healthcare (+0.37%) and financial services (+0.02%).
The top laggards were technology (-3.27%), utilities (-1.52%) and energy (-1.09%).
Trading volume rose to 3.30bn (up from 3.04bn previously) while trading value improved to RM3.43bn (up from RM2.89bn previously).
Market breadth stayed negative as 323 gainers underperformed 796 decliners.
The benchmark eased further yesterday after failing to breakout of Wednesday’s range.
They believed that the bulls are starting to lose its grip although the overall trend is still positive.
Overhead resistances are unchanged surrounding the 1,680-1,686 levels next, but these levels are expected to be tough to break.
The 1,700 psychological level is the following levels to watch in the near-term.
The 1,632-1,638 (May-July highs) levels remain as support for now.
Their portfolio stays in risk-on mode this week.
