THE FBM KLCI which has taken quite a beating lately amid concerns over uncertain political landscape staged a forceful rebound by breaching the 1,500-point psychological mark at the close of today’s trading.
Setting a perfect atmosphere to usher in the tabling of Budget 2021 tomorrow (Friday), the benchmark index shot up 36.88 points or 2.52% to end at the intraday high of 1,501.49.
Although total traded volume was lower at 6.92 billion shares from yesterday’s 7.34 billion shares, today’s traded value was higher at RM3.89 bil against yesterday’s RM3.36 bil.
Taking the cue from Wall Street’s strong finish during yesterday’s overnight trading, major Asian markets closed sharply higher today with shares in Hong Kong leading the region.
The Hang Seng rose 3.25% while Japan’s Nikkei 225 edged up 1.73% and China’s Shanghai Composite strengthened 1.30%.
Despite the unsettled state of the US presidential election race between incumbent President Donald Trump and his Democrat contender Joe Biden, the Dow Jones Industrial Index soared for the third straight session during yesterday’s overnight trading by chalking up 367.63 points or 1.34% to 27,847.66.
Back home, Malaysia awaits its “most important” annual budget from Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz with preserving people’s lives and livelihood amid an economy ravaged by the COVID-19 pandemic topping the agenda.
Whether today’s rally is sustainable – or otherwise an elusive one-day affair – is anybody’s guess although Bank Negara Malaysia decision to keep the overnight policy rate (OPR) unchanged at 1.75% has been hailed as positive for bank stocks.
After all, financial institutions are already facing immense pressure on their bottom line from the 125-basis-point (bps) cut seen this year in addition to the modification loss following the six-month loan moratorium that ended in September.
With strong gains remain elusive at current juncture, Malacca Securities Research reckoned that upsides are to be capped towards the immediate resistance at 1,480-1,500 points.
“In contrast, the supports located at 1,450, followed by 1,430. Indicators have turned mixed as the MACD Histogram has turned green, but the RSI remains below 50,” added the research house. – Nov 5, 2020