KLCI stays lacklustre on lack of fresh catalysts

TheEdge Fri, Jan 08, 2021 10:13am - 3 months ago

KUALA LUMPUR (Jan 8): The main index of Bursa Malaysia reversed its earlier loss but remained lacklustre in the mid-morning today on a lack of fresh catalysts.

At 10am, the FBM KLCI was up 0.61 point at 1,603.56. The index earlier slipped to a low of 1,596.98.

Losers led gainers by 437 to 354, while 387 counters traded unchanged. Trading volume was 1.34 billion shares valued at RM836.64 million.

The top gainers included KESM Industries Bhd, Oriental Interest Bhd, Malaysian Pacific Industries Bhd, Hartalega Holdings Bhd, Sarawak Oil Palms Bhd, Euro Holdings Bhd, UWC Bhd and Supermax Corp Bhd.

The actively traded stocks included Vortex Consolidated Bhd, Dynaciate Group Bhd, DGB Asia Bhd, AwanBiru Technology Bhd and Inix Technologies Holdings Bhd.

The decliners included Heineken Malaysia Bhd, Nestle (Malaysia) Bhd, Dutch Lady Milk Industries Bhd, Hong Leong Financial Group Bhd, AEON Credit Service (M) Bhd, Maxis Bhd, Carlsberg Brewery Malaysia Bhd and Syarikat Takaful Keluarga Malaysia Bhd.

Reuters said Asian stocks opened higher today, with Japan hitting a three-decade high as investors looked beyond rising coronavirus cases and political unrest in the US and bet on an economic recovery later in the year.

Futures for the S&P 500 jumped 1.48% and Japan's Nikkei 225 rose 0.84%, hitting its highest level since August 1990, it said.

Inter-Pacific Research Sdn Bhd said after an insipid start to the day, the key index managed to not only recover its intraday loss yesterday but also gained ground in the afternoon session as bargain hunting returned for selective index heavyweights.

In its daily bulletin today, the research house said this also allowed the key index to climb back above the 1,600-point level at the close.

“However, market breadth was still decidedly negative with losers still overwhelming gainers, with traded volumes also thinner amid the more difficult market conditions.

“Despite yesterday’s rebound, it remains to be seen if there will be sufficient follow-through buying interest to sustain the gains even as the key index looks to extricate from its mildly oversold conditions,” it said.

Inter-Pacific said as it is, market interest is thinning due to a more cautious environment with the domestic political intrigue still largely on market players’ minds. In addition, rising Covid-19 cases are also leaving sentiments warier as a prolong outbreak could derail the country’s economic recovery prospects for 2021.

“In the interim, however, we think there could be further near-term gains, albeit milder, due to the still cautious near-term outlook that may prompt quick profit-taking actions ahead of the weekend. As a result, we think the 1,610 level is a significant near-term hurdle, followed by the 1,620 level. The support [levels], meanwhile, are at 1,590 and 1,580 points respectively.

“Lower liners and broader market shares, on the other hand, are looking weaker due to fewer available catalysts and we think their consolidation is likely to continue. The pullback is deemed healthy as it would allow some of these stocks to take a breather after a significant run-up in 2020 that also left [their] valuations elevated,” it said.

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