Weakness in two-thirds of index drags market down

The FBM KLCI (-0.5%) reversed all its previous session gains, dragged down by weakness in more than two third of the key index components yesterday.

Weakness in Index

The lower liners also took a step back, while only the REIT and Transportation & Logistics sectors that rose 0.1% each outperformed the negative sectorial peers.

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Market Outlook

“With bouts of increasing volatility taking place across Wall Street overnight, we reckon the weakness may permeates to stocks across Bursa Malaysia today,” says Apex Research.

After the 1,630 pts gave way, the key index is now looking to defend the 1,600 pts support. The lower liners may also brace for further volatility as investors locks in gains from the stellar performance in recent months. Investors will be keeping a close tab onto the advance reading of US 2Q24 GDP data later tonight alongside with the on-going flurry of corporate earnings releases. Amidst the heightened volatility, we remain defensive, favouring the REIT and Utilities sector. We expect the negative performance of selected Technology giants on Wall Street overnight may also send local technology players into the red today.

Global Markets Review

Wall Street remained downbeat as the Dow (- 1.3%) tanked below the 40,000 psychological level following lackluster quarterly results from Tesla and Alphabet. European stock markets also turned negative, while Asia stock markets finished mostly in red.