The FBM KLCI formed a hammer candle

The FBM KLCI formed a hammer candle to edge marginally lower as the key index defended SMA50. Indicators remained mixed as the MACD Line hovered below the Signal Line, while the RSI treaded above 50. Immediate resistance located at 1,650. Support is envisaged around 1,580.

The local bourse (-0.1%) shed some of its previous session gains as profit taking activities emerged yesterday. Similarly, the lower liners also declined, while the energy sector (+0.6%) outperformed among its sectoral peers.

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A hammer candle

“On the global stage, the Fed maintained its key interest rate but signaled lowering it as early as mid-September, due to easing inflation and a cooling job market. Nevertheless, the sell-off in Thursday has shown growing fears of potential recession in the US market amid the softer economic data lately. Back home, we anticipate the local bourse to remained flat due to negative sentiment from the global market.

“Meanwhile, the lower liners are likely to move similarly to the key index due to tepid trading appetite. Key economic focus later today would be US unemployment rate and factory orders. Given the rise of volatility risk in the market, we advocate investors to turn defensive and focus onto gold related stocks on renewed Fed cut bets,” says Apex.

Global Markets Review

US stock markets retreated with Intel and Amazon taking a hit after the announcement of disappointing results. The European stock markets closed lower, while Asia stock markets were mixed following comments from Powell, indicating a rate cut in September.