THE FBM KLCI (-0.04%) ended marginally lower, dragged down by selling pressure in the Banking and Industrial Products & Services sectors; in line with the regional markets’ performance as investors traded cautiously ahead of a few key economic data that will be released in the US.
“The local market ended on a mixed note, with the FBM KLCI closing slightly lower, while the attention has shifted to small caps and lower liners. Meanwhile, the US stock markets were closed for a public holiday,” said Malacca Securities in the recent Market Pulse Report.
With flat performances in European markets and several key economic data releases, such as ISM Manufacturing and jobs data, due this week, traders may remain cautious in the near term.
Currently, the market expects a 25 basis points rate cut in this FOMC meeting.
In the commodity markets, Brent oil rebounded as oil exports at Libyan ports were halted on Monday, and production was reduced across the country.
Gold prices continue to trade sideways around the USD 2,500 mark, while crude palm oil prices remain above the RM 3,900 level.
“We expect the heavy selling in small caps seen in August to be overdone, with lower liners likely to recover in September while heavyweights may take a breather,” said Malacca Securities.
Given the stronger ringgit performance over the past few months, sectors such as Consumer, Construction, Building Materials, and Property may benefit.
Malacca Securities also favour stocks with strong fundamentals and growing earnings in their recent results.
The FBM KLCI index ended flat at the 1,678 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 1,693-1,698 and the support is set at 1,658-1,663. – Sept 3, 2024
Main image: theedge
