AFTER registering a historical high of 1,670.16, the FTSE Bursa Malaysia KLCI (FBM KLCI) is expected to extend its rally this week on further improvement in the external environment as well as support from banking stocks.
Affin Investment Bank Bhd vice-president and head of retail research, Dr Nazri Khan, said the benchmark index was expected to trend higher in tandem with regional strength.
This will be further supported by an active flow of Chinese economic data and anticipation of more aggressive stimulus following the upcoming European Union summit, he said.
“Following the positive weekly performance in the United States and Europe as well as reversals seen in China and Japan, we expect the FBM KLCI to maintain its positive momentum and possibly set a fresh record next (this) week,” he told Bernama.
He said Moody's reports maintaining Spain's investment grade credit rating as well as better-than-expected economy data in China for the third quarter would be positive triggers for risk-taking sentiment.
Nazri said continued leadership and measure of support would come from the local finance sector, driven by the strength in Maybank, Public Bank, CIMB and Hong Leong Bank.
“Based on Fibonacci extension, we are pegging 1,680 and 1,700 as the most likely major targets for FBM KLCI's near and medium term. Support, however, might come from accumulation near the 1,660 and 1,650 levels, he said.
Apart from that, several important catalysts were likely to spice the market in the near term including the potential privatisation from local airlines and insurance industry as well as potential third round of consolidation in the local banking stocks, Nazri said.
Astro Malaysia Holdings Bhd was relisted on the Main Market on Friday after it was taken private by its major shareholder T. Ananda Krishnan in 2010. It was valued at RM8.3bil, or RM4.30 a share, at that time.
The debut on Friday saw the stock, which moved between RM3.00 and RM3.11, closed at its offer price with 269.74 million shares traded.
On the same day, the FBM KLCI kept surpassing the all-time high several times before resting at 1,670.16.
However, the market ended mixed on mild profit-taking in certain heavyweights like Petronas Chemicals and Maxis, which slightly dragged down the benchmark index.
On Friday-to-Friday basis, the FBM KLCI improved 12.99 points to 1,666.35 compared with the previous Friday's closing of 1,653.36.
The Finance Index surged 179.23 points to 14,884.80, Industrial Index rose 21.30 points to 2,867.80 and the Plantation Index advanced 19.81 points to 8,195.61.
The FBM Emas Index jumped 69.70 points to 11,312.16, FBMT100 gained 69.14 points to 11,151.00 and the FBM ACE Index was 81.84 points higher at 4,282.79.
The FBM 70 Index, however, slipped 8.72 points to 12,169.73.
The weekly turnover rose to 5.956 billion shares worth RM7.976bil from 4.477 billion shares worth RM6.601bil the previous week.
The Main Market volume increased to 4.801 billion units valued at RM7.786bil from 3.407 billion units valued at RM6.418bil previously.
The ACE market volume jumped to 883.272 million shares worth RM165.794mil from 748.351 million shares worth RM156.804mil the week before.
Warrants dropped to 197.735 million units valued at RM13.55mil from 291.58 million units valued at RM19.22mil previously. Bernama
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