Sunday 04 Jun 2023
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KUALA LUMPUR (July 20): The FBM KLCI is expected to resume trade today on a positive note after the extended weekend for the Hari Raya break.

Wall Street's Nasdaq stock index ended at a record high on Friday on a rally in Google shares, while weak energy stocks and disappointing corporate results from companies such as Boeing and Volvo hit other European and U.S. indexes and the dollar rallied on strong U.S. inflation and housing data, according to Reuters.

Google surged 16.26 percent to end at an all-time high of $699.62, pushing the Nasdaq to a second straight record high. A 6.3 percent drop in Volvo shares and a halt to a Greece-driven relief rally stymied European shares, meanwhile, while a 1.1 percent drop in Boeing shares and a similar tumble in the S&P 500 energy index weighed on the Dow and limited the S&P 500's gains, it said.

AllianceDBS Research said the FBM KLCI had on July 16 traded marginally lower to 1,720.70 after opening as some market participants chose to lock in a portion of their trading gains ahead of long weekend.

However, the research house said supportive buying interest lifted the benchmark index to close near the day’s high at 1,726.73 (-0.53, -0.03).

The research house said that in the broader market, losers outnumbered gainers with 330 stocks ending lower and 314 stocks finishing higher.

“That gave a market breadth of 0.95 indicating the bears were in control with the bulls closely matched,” it said.

AllianceDBS Research said the lower low followed by higher high market setup on July 16 indicated that there was supportive buying interest in the game play.

The research house said the interesting part of the market was the ability of the benchmark index to keep its position above the 20-day MA line in the last 3 market days.

“This should thus lead to new buying attempts to take the benchmark index into higher ground.

“The immediate hurdle is pegged at 1,728. A rise above 1,728 could see the market gearing toward the next hurdle at 1,739.

“The support is at 1,706. A fall below 1,706 would pressure on the market down to the subsequent support at 1,698,” it said.

The research house said that indicator wise, the MACD was above the 9-day moving average line.

“The analysis of overall market action on July 16 revealed that buying power was stronger than selling pressure.

“As such, the FBM KLCI would likely trade above the 1,727.50 level on July 20,” said AllianceDBS Research.


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