Ahead of Monday’s holiday for Malaysia Day, Bursa Malaysia had moved higher in consecutive trading days, gathering almost 15 points or 0.9 percent along the way.
The Kuala Lumpur Composite Index now rests just above the 1,650-point plateau and it may tick higher again on Tuesday.
Malacca Securities (MSSB) said in a note today (Sept 17) The FBM KLCI (+0.84%) rebounded strongly, as Banking and Industrial Products & Services heavyweights, namely CIMB (+23.0 sen) and PMETAL (+17.0 sen), boosted the sentiment on the local front; in line with the US stock markets’ performance despite the hotter-than-anticipated key inflation data.
The Day Ahead
The FBMKLCI rebounded last week, alongside broader market gains and small-cap stocks, as sentiment improved following a recovery in crude oil prices.
In the US, Wall Street ended on a mixed note: the Dow reached record highs, while the Nasdaq saw a slight decline as tech stocks lagged ahead of the upcoming FOMC meeting.
Traders appear to be pricing in a potential 50bps interest rate cut, aimed at steering the economy towards a soft landing.
This week, traders will be focusing on the US retail sales, while the buying momentum may extend on local front.
In the commodities market, Brent oil extended its recovery due to potential production cuts in the Gulf of Mexico, while gold surged to a record high above USD 2,580 as the market anticipates the rate cut this week.
On the other hand, crude palm oil closed lower, nearing RM3,800.
Sector Focus: The Nasdaq’s softer performance, combined with the stronger ringgit at RM4.298/USD, may negatively impact sentiment in the technology sector.
However, the strong ringgit could support domestic sectors such as Consumer and Utilities.
Additionally, they saw potential in Construction, Property, and Building Materials, as earnings from data center projects may start to materialise moving forward.
Bloomberg FBMKLCI Technical Outlook
The FBM KLCI index closed higher towards the 1,652 level.
However, the technical readings on the key index were mixed, with the MACD histogram forming another negative bar but the RSI hooked above 50.
The resistance is envisaged around 1,667–1,672, and the support is set at 1,632–1,637.
