Cautious market sentiment prevails, KLCI to stay range-bound

KUALA LUMPUR: Bursa Malaysia traded lower in the early trade amidst Wall Street’s weak performance overnight.

The FBM KLCI fell 5.22 points, or 0.36% to 1,463.13 at 9.13 am. The index opened 0.81 of a point higher at 1,469.16.

All indices on Bursa Malaysia, apart from the Bursa Malaysia Health Care Index, were down.

The healthcare index rose 5.51 points, or 0.33% to 1,674.41 points. Careplus Group Bhd, Top Glove Corp Bhd, LKL International Bhd, Supermax Corp Bhd and Hartalegea Holdings Bhd are among the most active healthcare counters.

TA Securities said the local market should stay range bound on lacklustre trade ahead of the Christmas holiday weekend on persistent worries sustained high inflation and interest rates will cause a global recession.

“Key chart supports on the index remains at 1,460 and 1,450, with better supports from 1,420 and 1,400.

“Immediate resistance stays at the 1,500 psychological level, with 1,512, and the August high near 1,528 as stronger resistance levels, followed by 1,550 and 1,570 as tougher upside hurdles,” it added.

Inter-Pacific Research said despite yesterday’s rebound, overall market conditions are likely to stay restrained as sentiments are still largely cautious, continuing to be undermined by the prognosis of further challenges to the global economic environment next year.

“The unsettled market confidence ahead of the upcoming year-end festivities would also reduce market participation and this could still leave the FBM KLCI to drift further, in our opinion.

In addition, Wall Street’s lower overnight closing would also weigh on sentiments for longer.

“Under the prevailing environment, we maintain our view that the key index will likely be on a sideway-to-lower trend, hovering between the 1,460 and 1,480 levels ahead of the long Christmas weekend.

“The supports are at 1,460 and 1,450 points respectively, while the immediate resistance is at the 1,470 level, followed by the 1,480 level,” the research house said.

“We also see the lower liners and broader market shares staying mostly insipid ahead of the long weekend as well. Many retail players are already on their year-end break and the lower participation could also leave these stocks to stay subdued for longer,” Inter-Pacific said.

Overnight, the US market plunged following concerns that global central banks' monetary tightening would push the economy into recession.

The Dow Jones Industrial Average fell 348.99 points, or 1.05%, to 33,027.49 — after falling as much as 803.05 points earlier in the session.

S&P 500 declined 1.45% to 3,822.39 while the Nasdaq Composite was 2.18% lower at 10,476.12

Among the losers on Bursa Malaysia, Hextar Technologies lost 52 sen to RM16.20, Kotra eased 19 sen to RM6.25, PETRONAS Chemicals fell 18 sen to RM8.22 and Malaysian Pacific Industries declined 16 sen to RM29.14.

Apollo rose 20 sen to RM3.84, Kuala Lumpur Kepong added 10 sen to RM21.36, PETRONAS Dagangan gained 10 sen to RM22.10 and Kluang Rubber climbed five sen to 72 sen.