KUALA LUMPUR (July 7): The FBM KLCI is expected to test the 1,700-point level today and retrace some of its losses yesterday on some likely bargain hunting activities.
However, any gains are likely to be limited given that the local market is devoid of any fresh catalysts.
Equity markets around the world fell on Monday and U.S. oil prices tumbled 7 percent after Greece overwhelmingly voted against conditions for a rescue package and following unprecedented measures in China to staunch recent massive losses in its stock markets, according to Reuters.
Wall Street shares fell less than some had feared. The International Monetary Fund reassured investors by saying it was ready to help Greece if asked to do so. European shares fell around 2 percent, a relatively muted reaction to the Greek vote, it said.
AffinHwang Capital Research in a note yesterday said that bearish global stock markets, combined with absence of local catalyst may lead the FBM KLCI to test 1700 points.
“Times of turbulence seen in money market, Greek struggles to solve its liquidity problem,
“Technically local market is anticipated to be trapped in a two-month downtrend channel influenced by volatile currency and commodity markets,” it said.