KLCI to trend lower with support at 1,815

KUALA LUMPUR: BIMB Securities Research expects the FBM KLCI to trend lower on Thursday following the weak overnight close on Wall Street and the recent profit taking by foreign funds.

It said the KLCI fell 6.45 points to close at 1,820.97 on Wednesday.

BIMB Research said the decline was due to profit taking after the 9.15 point gain on Tuesday.

“We expect the index to trend lower with immediate support at 1,815 and immediate resistance at 1,830,” it said.

Foreign funds were net sellers on Wednesday at -RM161.2mil while retailers were also net sellers at –RM6mil. However, the selling was well absorbed by local institutions, it said.

The research house said US stocks fell across industries on Wednesday as investors were worried about the stock valuations, economic growth and rising interest rates. Stocks rose at the start of trading, but quickly gave up their gains.

A comment from Federal Reserve Chair Janet Yellen suggesting that stocks are generally overvalued added to the selling pressure.

The DJI Average dropped 86.22 points, or 0.5%, to 17,841.98.

In Asia, most markets were uneven as investor sentiment was dented by losses on Wall Street and doubts about Greece's ability to repay debts due to the IMF this month.

However, the Chinese markets rebounded from the previous day's sell-off.