The FBMKLCI (-0.01%) closed flat due to lack of buying interest amid the weaker regional market sentiment as investors are eyeing several key economic data from Wall Street this week. On the broader market, the Healthcare sector (+1.43%) rose on the back of glove counters, while the Energy sector (-1.06%) fell.
RHB Retail Research Market Dateline said today (Nov 29) that the FKLI attempted to rebound from Monday’s low, writing off most of its intraday gains to settle 3 pts higher at 1,450 pts.
The correction process starting from the 1,468.50 immediate resistance has been paused, with the index likely to hover near the 50-day SMA line.
Yesterday, the FKLI opened higher at 1,448 pts, and attempted to climb higher towards the 1,455 pts day high, before writing off most of its profits and settling just above the opening level. Yesterday’s mild rebound following the recent retracement would potentially see the FKLI trade sideways near the 50-day SMA line in the upcoming sessions.
The near-term sideways movement is supported by the flat RSI momentum indicator at the 50% level. For the medium-term outlook, RHB thinks the FKLI may rebound upwards towards the immediate resistance at 1,468.50 pts, should the momentum picks up again.
Since the 50-day SMA line is above the 200-day SMA line, the medium-term trend remains bullish. So, RHB maintains their positive trading stance.
Traders should stick to the long positions initiated at 1,455 pts, ie the close of 3 Nov. To manage the trading risks, the stop-loss threshold is set at 1,430 pts.
The immediate support is set at 1,430 pts, followed by 1,410 pts. Conversely, the nearest resistance is pegged at 1,468.50 pts – 1 Aug’s high – followed by 1,485 pts.
Malacca Securities (MSSB) said the FBMKLCI ended flat for the session as traders traded cautiously in line with the weak regional market sentiment.
However, Wall Street continued to charge higher despite the mixed statements from several Fed’s officials, with the help of consumer confidence index. Investors will continue to monitor the upcoming core PCE and ISM Manufacturing PMI data later this week.
MSSB expects some buying interest to spillover to stocks on the local front, following the surge on Wall Street.
On the commodity markets, the Brent oil prices ended positively above the USD81/bbl in view of further production cuts to be seen in the OPEC+ meeting on 30th Nov. Besides, the gold extended the gains above the USD2k level.
Sector focus: Traders may focus on the Technology sector with the strong rebound on Wall Street. On the release of financial results, they expect the Consumer and Poultry sectors could rally another round on the back of growing earnings from Leong Hup International, Farm Fresh Berhad and LTKM. Besides, they still favour the Building Material, Utilities, Property and Construction sectors in this earnings season.
Bloomberg FBMKLCI Technical Outlook
The FBMKLCI is still in the consolidation phase. Meanwhile, the technical readings on the key index are negative, with the MACD Histogram extending another negative bar, while the RSI continued to decline below the 50 level. The resistance is pegged around 1,455-1,460 and the support is at 1,430-1,440.
