KUALA LUMPUR: The FBM KLCI slipped in early morning trade with investors cautiously waiting on the sidelines as the US Federal Reserve rate announcement is expected overnight.
Malaysia's stock market has continued to drift lower this week amid the absence of domestic catalysts, and the wait for clarity on the US lending rate.
As at the time of writing, the CME FedWatch Tool suggests an 87.6% probability of a quarter-percentage point rate cut, and 12.4% odds of no change.
Despite the high likelihood of a rate cut, Malacca Securities, noted that US policymakers may still signal a "hawkish" cut amid firmer labour indicators and limited fresh data following the government shutdown.
"We believe clearer market (Wall Street) direction will only emerge after the Fed’s interest rate decision on Thursday.
"We expect the FBM KLCI to remain soft ahead of the conclusion of the FOMC meeting," it said in a note.
The FBM KLCI opened on Wednesday 3.13 points lower at 1,611.04, with the mixed result on Wall Street overnight doing little to ease investor tension.
"With weak undertones and subdued buying momentum, the local stock
market is likely to maintain a downward bias, as most investors remain on the sidelines awaiting an improvement in sentiment," said TA Securities in its market commentary.
"Immediate support is maintained at the 61.8%FR (1,564), with stronger supports seen at the 50%FR (1,527) followed by the 38.2%FR (1,490). Immediate resistance is kept at the December 2024 high of 1,644, with the highs of 1,684, and 1,695 acting as tougher upside hurdles."
Among early market movers, Press Metal
shaved 16 sen to RM6.68, LPI dropped eight sen to RM14.52 and Gamuda lost seven sen to RM5.07.
Top actives included TWL unchanged at 2.5 sen, LAC Med up two sen to 77 sen and Zetrix AI rising 2.5 sen to 83 sen.
