KUALA LUMPUR (July 25): The FBM KLCI stayed in negative zone at the midday break against the backdrop of cautious regional markets, dragged by Petronas-linked stocks.

At 12.30pm, the FBM KLCI was down 0.53 points to 1,651.88.

Losers led gainers by 310 to 205, while 554 counters traded unchanged. Volume was 1.58 billion shares valued at RM879.42 million.

The top losers included Telekom Malaysia Bhd, Manulife Holdings Bhd, Petronas Dagangan Bhd, British American Tobacco (M) Bhd, Petronas Gas Bhd, Khind Holdings Bhd and Pentamaster Corp Bhd.

The actives included KNM Group Bhd, NetX Holdings Bhd, Sumatec Resources Bhd, Dynaciate Group Bhd, Dagang NeXchange Bhd and Green Packet Bhd.

The gainers included Fraser & Neave Holdings Bhd, United Plantations Bhd, G3 Global Bhd, Petronas Chemicals Group Bhd, Nestle (M) Bhd, Chin Teck Plantations Bhd, KESM Industries Bhd and Magnum Bhd.

Asian shares rose but struck a more cautious note than a tech-fuelled rally on Wall Street, while the euro stayed near two-month lows as soft economic data fuelled hopes the European Central Bank (ECB) could cut rates at its meeting on Thursday, according to Reuters.

Japan's Nikkei touched nearly three-month highs before trimming gains to be up 0.33%. Australian shares neared a 12-year peak, driven by expectations the ECB and the US Federal Reserve will soon lower borrowing costs, it said.

Hong Leong IB Research said that in the near term, all eyes continue to focus on the ongoing reporting season and the resumption of US-China trade negotiations next week.

It said while most companies are beating revised-down estimates, the tone and substance of management commentary is on the cautious side, with uncertainty about global trade as notable headwind.

"Up to now, the total S&P 500 earnings are expected to decline 1.3% year-on-year from -3% before the reporting season starts. Having said that, market sentiment is largely positive in anticipation of a minimum 25-bps cut during the July 30-31 FOMC (Federal Open Market Committee) meeting. We see the Dow to continue to trend at range bound mode within 26,800-27,500 zones.

"Ahead of the two major events next week focusing on the resumption of trade talks in Shanghai and FOMC meeting (July 30-31), we expect sentiment on the broader market to remain mildly positive, despite rotational selling pressures among index-linked heavyweights.

"Technology stocks are likely to hog the limelight amid all-time high Nasdaq whilst oil & gas stocks should stay supported with rising geopolitical tensions shoring up global oil prices," it said.