Two-third of the key index components closed in green yesterday

The FBM KLCI (+0.7%) started off the week on a buoyant manner with more than two-third of the key index components closed in green yesterday.

The lower liners remained upbeat, while the Healthcare (-0.3%) and Transportation & Logistics (-0.1%) sectors underperformed the mostly positive sectorial peers. 

Market Outlook

Expectedly, the key index advanced and subsequently rose above 1,600 psychological level yesterday. Looking ahead, we expect the local bourse may attempt to defend the aforementioned level. Meanwhile, the unabated volatility on Wall Street overnight may keep any further gains in check. The lower liners recovery may also come into a minor halt as investors may take this opportunity to book in recent short-term profits to monitor the geopolitical developments in the Middle East. For today, investors will be keeping a close watch onto the release of US Producer Price Index (PPI) data later tonight. Surge in oil prices due to the escalated geopolitical tension in the Middle East whereby Brent oil prices rallied above US$80/bbl may present some trading opportunities within oil & gas sector. Gold-related stocks may also turn into the limelight with gold prices firmed above US$2,400/oz.

FBM KLCI Technical Review & Outlook

The FBM KLCI formed a bullish candle and closed above the 1,600 psychological level yesterday. Indicators have turned mixed as the MACD Line stayed below the zero level, while the RSI hooked above 50. The next resistance is located at 1,630. Support is envisaged around 1,530.

Wall Street turned wobbly as the Dow slipped -0.4% on heightened Middle East geopolitical tension while investors turned to the sidelines ahead of the release of US inflation data on Wednesday night. Both the European and Asia stockmarkets ended mixed.