KUALA LUMPUR (Oct 24): The FBM KLCI is expected to trend sideways today, with immediate support seen at the 1,740-level.

U.S. stocks on Monday pared gains in late-afternoon trading after losses in General Electric weighed on Wall Street indexes, while U.S. Treasury prices rose in light volume, according to Reuters.

General Electric was on track to post its worst single-day loss in more than six years, after a bunch of brokerages cut their price targets on the stock, citing higher chances of a dividend cut at the industrial conglomerate. The company tumbled 6.4 percent, it said.

The Dow Jones Industrial Average fell 2.66 points, or 0.01 percent, to 23,325.97, the S&P 500 lost 3.86 points, or 0.15 percent, to 2,571.35 and the Nasdaq Composite dropped 16.80 points, or 0.25 percent, to 6,612.25, said Reuters.

AllianceDBS Research in its evening edition Monday said despite last Friday’s weak down close, the FBM KLCI had on Oct 23 traded formed an inside day bar as market participants decided not to stage an immediate follow through selling pressure.

It said in the absence of stronger selling interest, the benchmark index was in the green throughout the trading sessions before settling near the day’s low at 1,741.47 (up 0.82 points or 0.05%).

“In the broader market, losers outnumbered gainers with 453 stocks ending lower and 434 stocks finishing higher. That gave a market breadth of 0.95 indicating the bears were in better control with the bulls closely matched,” it said.

AllianceDBS Research said following last Friday’s settlement at 1,740.65, the market was on the verge of breaking below the 1,740 level to test a lower ground again on Oct 23.

“However, a change of game play pattern took place on Oct 23 with market participants decided not to stage an immediate follow through selling pressure.

“This helped to form an inside day bar. An inside day bar indicated a pause in the game play with both buyers and sellers seen in a balanced position.

“It is indeed good to see the market trading in the green on Oct 23, but it remains premature to confirm anything at this juncture as more technical evidence are needed,” it said.

The research house said following the weak up close, there should be selling attempt again with immediate support at 1,740.

It said a fall below 1,740 would put pressure on the index down to the subsequent support at 1,730.    

“The analysis of overall market action on Oct 23 revealed that buying power was weaker than selling pressure.

“As such, the FBM KLCI would likely trade below the 1,741.38 level on Oct 24,” said AllianceDBS Research.

Based on corporate announcements and news flow yesterday, stocks in focus today may include: Denko Industrial Corp Bhd, British American Tobacco (M) Bhd, I-Bhd, TAS Offshore Bhd, Titijaya Land Bhd, KKB Engineering Bhd, HeiTech Padu Bhd, Berjaya Land Bhd, Esthetics International Group Bhd, Axis REIT and T7 Global Bhd.