The FTSE Bursa Malaysia KLCI fell 9.2 points to 1,665.6 last Friday (Sept 18), weighed down by losses in major index constituents despite improved overall market breadth and stronger trading activity.
The benchmark index declined approximately 0.55%, with Tenaga Nasional, Hong Leong Bank, Petronas Chemicals, IOI Properties Group, YTL Corporation and YTL Power International among the main drags.
The retreat came as regional markets traded cautiously, even as several Asian bourses advanced following a technology-led rebound on Wall Street and easing oil prices.
Trading activity on Bursa Malaysia increased significantly, with volume rising 36% to 4.92 billion shares and total value climbing 50% to RM4.88 billion. Market breadth improved to 1.11 from 0.69, indicating that gains among the broader market were more widespread despite the KLCI’s decline.
Local retail investors remained net buyers for a fifth consecutive session, purchasing RM47 million worth of equities on Friday.
Their cumulative net buying reached RM397 million over five sessions and RM1.05 billion month-to-date, bringing their year-to-date net purchases to RM610 million.
Foreign institutions also returned as net buyers with RM56 million in purchases during the session. However, they remained net sellers of RM673 million for September and RM5.13 billion year-to-date.
Local institutions, meanwhile, recorded net selling of RM103 million on Friday, extending their month-to-date outflow to RM377 million. They remained net buyers of RM4.52 billion for the year.
From a technical perspective, the market report noted that the KLCI has resumed its downward trend after retreating from its Aug 26 high of 1,753.
The index has slipped below its long-term ascending trendline and descending-channel support, leaving 1,655, its year-to-date low, as the immediate level to watch.
HLIB in its report noted that a further decline could bring the next support level at 1,639 into focus.
Nevertheless, oversold technical indicators suggest the possibility of a short-term recovery. The report identified 1,685 as the first resistance level, followed by 1,702, which corresponds to the 200-day moving average.
A sustained recovery above these levels could shift attention towards 1,717 and 1,731
Market sentiment this week is expected to be influenced by developments in US-China trade discussions, alongside upcoming US durable goods orders and purchasing managers’ index data.
Higher US Treasury yields also remain a consideration for equity markets. The US 10-year yield rebounded seven basis points to around 5% on Friday, partly offsetting gains in technology stocks.
For Bursa Malaysia, the report indicated that the KLCI could attempt an oversold rebound towards the 1,685–1,700 range, although concerns over corporate earnings and a prolonged period of elevated financing costs may constrain the recovery.
Investors will also be watching upcoming Malaysian corporate results for signs of whether earnings can support a more sustained market rebound.
