KUALA LUMPUR: Malaysian equities are expected to trade cautiously today following overnight weakness on Wall Street and continued uncertainty surrounding geopolitical developments in the Middle East.
The FBM KLCI rose 7.47 points, or 0.43%, to close at 1,733.36, although market breadth remained negative with 762 decliners against 438 advancers and 576 counters unchanged.
Defensive sectors provided support, with Plantation stocks benefiting from their defensive earnings profile and firmer commodity prices amid heightened geopolitical uncertainty. Plantation gained 0.68%, while Industrial Products and Finance advanced 0.78% and 0.29%, respectively.
Malaysian equities
Consumer and Utilities stocks were among the weaker performers, declining 0.78% and 1.17%.
The cautious outlook follows declines across major global markets. The S&P 500 fell 0.69%, while the Nasdaq Composite and Dow Jones Industrial Average declined 1.33% and 0.22%, respectively. Lingering Middle East tensions and elevated bond yields continued to weigh on investor sentiment.
In the United States, industrial production rose 0.2% month-on-month in July following a 0.3% increase in June, indicating steady but modest industrial growth. However, relatively low manufacturing capacity utilisation suggests room for further expansion.
Asian markets
Asian markets also ended lower, with Japan’s Nikkei 225 falling 2.54%, South Korea’s KOSPI declining 1.55% and the Shenzhen Index easing 0.56%.
Locally, traders are expected to remain selective, with Plantation, financial and selected Industrial stocks potentially attracting defensive buying. Consumer and growth-oriented counters may remain subdued.
The FBM ACE Index could also face profit-taking after its recent strong rally, prompting investors to lock in some gains.
Technically, the FBM KLCI remains around its nine- and 20-day moving averages within a downward channel. Repeated rejection at 1,750–1,760 indicates strong resistance, while a break below 1,720 could expose the index to 1,700 and subsequently 1,680.
A decisive move above 1,750 would be required to turn the outlook more constructive.
Source: Apex
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