FBM KLCI Slips Again as Broad Market Strength Masks Foreign Selling Pressure

Malaysia’s FBM KLCI declined for a second session despite broader market gains, while investors monitored foreign selling, sector rotation, and upcoming US economic data for market direction.

FBM KLCI Faces Pressure

Malaysia’s benchmark FBM KLCI slipped 0.11 percent to 1,664.06 on Tuesday, marking its second consecutive session of modest losses despite stronger performance across the broader market and most industry sectors.

The benchmark lagged mainly because of profit-taking in the financial sector, which fell 0.32 percent and outweighed gains elsewhere. Construction emerged as the strongest performer, rising 1.78 percent, followed by technology at 1.02 percent and REITs at 0.87 percent. Industrial Products and Services also ended lower.

Market breadth remained healthy, with 565 gainers against 414 losers. Smaller companies continued to outperform, with the FBM Small Cap Index gaining 0.40 percent and the ACE Market climbing 0.71 percent.

However, foreign investors returned to net selling, recording RM183 million in outflows, while local institutions absorbed most of the selling with RM198.8 million in net purchases.

Global markets ended mostly higher as US equities completed their strongest quarter in six years. Technology shares continued to lead gains, while investors shifted their focus to upcoming US labour market data that could shape expectations for future interest rate cuts.

Analysts expect attention to remain on US payrolls data and manufacturing figures this week, as weaker economic readings could strengthen expectations of Federal Reserve easing.

Domestically, technology and construction sectors are expected to stay in focus, supported by global semiconductor demand and infrastructure projects, while REITs may benefit from renewed hopes of lower interest rates. Banks, meanwhile, are seen as crucial to helping the FBM KLCI recover from its recent weakness and regain stronger market momentum ahead.