An equity analyst said that this phase was after the local stock market recorded two record highs in trading volume, exceeding 12 billion units in one week when it saw the first record amid heavy selling on Monday, followed by the second record on Thursday during a bullish trend.
"This indicates that retail investors are the 'fast players' currently as they change market portfolio in a short period of time, capitalising on gains and cut losses during a sell down,” she said.
However, she added that due to the strong demand from the glove sector which drove the market higher, an inverted hammer pattern was seen throughout the market trend.
For the coming week, she said the market was expected to trade between 1,580 which is the immediate support level and 1,600 points, its resistance level.
"Upon breaching the 1,600 level coupled with positive market catalyst, the index could continue soaring towards 1,610 and above. However, without the presence of a new catalyst, the index will likely retreat once it breaches the 1,600-point benchmark,” she said.
On the overall market, the healthcare sector remains the favourite among investors in a rotational play between glove and pharmaceutical stocks, while energy counters continue to be the main volume mover.
This trend is expected to continue as the healthcare sector is yet to reach its peak as concerns over COVID-19 continue to plague the market.
On index performance, despite the retreat, healthcare index still recorded a gain on a week-on-week basis as it increased 202.7 points, with Top Glove and Hartalega being the main market mover.
For next week, investors will be awaiting the US Federal Open Market Committee meeting on July 28-29, following rising unemployment rate in the US.
While the US Federal Reserve is expected to keep rates at the current level, the move would be seen as an ultimate support in rebuilding the nation’s economy.
On the oil front, benchmark Brent Crude is expected to continue to hover at US$42 to US$45 per barrel, as downside risk is still clouding the oil industry.
Coupled with the continued rising in COVID-19 cases and fears of another wave of infections, the oil price is not going to see a bullish trend anytime soon.
For the week just ended, the key index FTSE Bursa Malaysia KLCI (FBM KLCI) moved in a consolidation mode despite heavy volumes recorded throughout the week.
On a Friday-to-Friday basis, the index declined 6.72 points to end at 1,589.61 from 1,596.33 last week.
On the scoreboard, the FBM Emas Index slipped marginally by 0.27 of-a-point to 11,272.18, the FBMT 100 Index shed 16.16 points to 11,114.05, while the FBM Emas Shariah Index added 98.77 points to 13,098.05.
The FBM 70 expanded 101.54 points to 14,154.28 and the FBM ACE Index climbed 407.18 points to 7,898.
Sector-wise, the Plantation Index increased 146.21 points to 7,115.03, the Financial Services Index decreased 159.80 points to 13,417.64 and the Industrial Products and Services Index inched up 0.97 of-a-point to 139.65.
Weekly turnover dipped to 45.32 billion units worth RM28.93 billion from 47.26 billion units worth RM24.58 billion in the previous week.
Main Market volume surged to 53.22 billion shares worth RM28.75 billion from last week’s 21.69 billion shares valued at RM23.41 billion.
The market exceeded 12 billion shares in volume transaction twice in the week, registering a record high.
Warrants turnover meanwhile declined to 3.60 billion units worth RM736.71 million from last week’s record of 4.96 billion units worth RM1.97 billion.
The ACE Market volume saw an exponential hike, reaching 26.14 billion units transacted worth RM5.81 billion from 19.08 billion units valued at RM3.35 billion last week. - Bernama