Market Wrap: Investors digesting domestic policy development; regional markets mixed

The FBM KLCI closed marginally lower on Thursday, slipping 0.13% or 2.03 points to 1,588.21, as investors engaged in mild profit-taking following recent gains. Market breadth was negative with 646 losers against 377 gainers, while overall trading volume stood at 2.55 billion shares valued at RM2.51 billion, reflecting a cautious tone.

Sectoral performance was broadly negative, led by utilities (-1.2%), construction (-0.9%), and transportation (-0.6%), while selective buying supported industrial products & services (+1.0%) and plantation (+0.6%). The weakness in construction and transport names coincided with lingering concerns over cost escalations in large infrastructure projects, such as the Penang LRT, despite reassurances from MRT Corp.

Market Wrap

On the regional front, performance was mixed. Shanghai Composite (SHCOMP) rose 1.04% to 3,766.21 and Hang Seng Index (HSI) edged up 0.17% to 25,165.94, driven by bargain-hunting in Chinese equities. Singapore’s STI gained 0.08% to 4,219.54. However, Japan’s Nikkei 225 retreated 1.51% to 42,888.55, tracking profit-taking in heavyweight tech stocks.

Overnight, Wall Street closed mixed as the recent tech-led momentum faded and investors weighed the Fed’s rate cut prospects. The Dow Jones Industrial Average added 0.04% to 44,938.31, but the Nasdaq slipped 0.67% to 21,172.86 and the S&P 500 eased 0.24% to 6,395.79, underscoring investor caution ahead of key economic data.

Analyst View:
“We expect near-term sentiment on Bursa to stay subdued as investors digest domestic policy developments and await clearer guidance from the Fed. While foreign flows remain supportive, volatility in global tech names and concerns over fiscal discipline in large-scale infrastructure spending could cap upside momentum. For the immediate term, we see 1,580 as key support and 1,600 as resistance for the FBM KLCI.” = Rakuten

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