KLCI likely to trade cautiously lower today: Analysts

Analysts from Apex says the KLCI is likely to trade cautiously lower today, as yesterday’s regional rally left Asian markets exposed to Wall Street’s overnight slide, where Brent above USD100 and the harsh reaction to Alphabet and Tesla’s spending plans dragged the Nasdaq down 2.15%.

Adding to the mix, Washington has announced sweeping new tariffs of 10% to 12.5% on 60 trade partners covering 99.4% of US imports, taking effect today in place of the expiring 10% global levy, with exporters watching Malaysia’s assigned rate while oil, gas and fertiliser shipments are exempt.

“Expect Energy and oil-linked counters to be the day’s bright spot with Brent at USD101, Technology to lag on the megacap selloff, and trade overall to stay defensive and selective ahead of the weekend and next week’s Fed meeting, where year-high Treasury yields and record-low jobless claims have raised the risk of a hawkish outcome,” analysts say.

KLCI INCHES HIGHER AS USD100 OIL TESTS SENTIMENT

Malaysian Market Review. The FBM KLCI added 3.22 points, or 0.19%, to 1,714.59, steadying after two days of losses as bargain-hunting emerged, although breadth stayed negative with decliners ahead of advancers 589 to 428.

Construction (+1.04%) led the gainers on continued data-centre contract flow, followed by REIT (+0.36%) and Industrial Products (+0.21%), while Technology (-1.54%) resumed its slide as Plantation (-0.87%) and Property (-0.83%) make up the rest of the decliners.

Global Markets: The Dow Jones Industrial Average sank -0.97% to 51,711.65, the S&P 500 dropped -1.21% to 7,408.30, and the Nasdaq Composite tumbled -2.15% to 25,137.69 as the Brent broke above USD100 and megacap earnings deepened AI spending concerns.

Alphabet slid about 7% overnight after their result release, Tesla plunged 14% on weaker profit, and Treasury yields hit their highest levels this year as record-low jobless claims of 187,000 piled on in addition to rate worries.

Oil’s +5.80% surge to USD101.04 followed Houthi attacks on two Saudi tankers in the Red Sea, raising fears of a widening conflict. Europe fell in sympathy, with the STOXX 600 down -1.18% and the FTSE 100 losing -0.73%. In Asia, South Korea’s KOSPI rebounded +4.05%, Japan’s Nikkei 225 gained +3.56% and Hong Kong’s Hang Seng rose +1.28% (CNBC).

Market Outlook.

Sector focus. Energy remains at the top of the watchlist with Brent continuing its climb, favouring upstream producers and services names, while the tanker attacks add a freight-rate angle that could benefit shipping-exposed counters. Construction retains its momentum with data-centre related awards still flowing. Plantation could firm as CPO tracks crude higher, while Technology may stay pressured as the rest of the megacaps release their earnings, while rate-sensitive REIT and Property counters may face a tougher backdrop with global yields at year highs.

Technical Commentary

The FBM KLCI remains in a constructive consolidation phase after the recent rebound from the 1,660–1,670 zone, and it is now trading above its 20-, 120- and 200-day moving averages, which supports the broader uptrend. Near term, the index faces resistance around 1,720–1,740, where the descending trendline and recent swing highs converge; a decisive breakout there would likely open the way back toward 1,760–1,770. On the downside, 1,700-1,680 remain the key support to watch, followed by 1,625 if the rebound loses momentum.

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