KUALA LUMPUR: The FBM KLCI started lower on Thursday as the prospect of a more bullish US Federal Reserve to tackle rising inflation dampened investor sentiment for equities.
At 9am, the market barometer was down 1.58 points to 1,677.38, weighed by the latest US consumer price index that showed price increases jumping to a three-year high of 4.2%.
According to Apex Securities, the AI narrative remained in play and is expected to remain supportive ahead of the highly anticipated SpaceX IPO, although portfolio rebalancing activities ahead of the listing could contribute to near-term market volatility.
Helping the domestic market, ongoing efforts to strengthen Malaysia's economic ties with Japan through energy and high-technology cooperation may provide a supportive backdrop for investor sentiment.
"Nevertheless, uncertainty surrounding developments in the Middle East and their potential impact on oil prices may continue to drive market volatility in the near term," said the research firm in its market outlook.
From a technical standpoint, Apex Securities said the FBM KLCI remains at a critical juncture, hovering around the neckline of a bearish double top formation.
"A decisive break below this level could signal further consolidation or downside risk in the weeks ahead. Should the KLCI decisively breach the 1,670-neckline support, the index may extend its decline towards 1,640. On the upside, resistance is expected around the 1,700 mark."
Among the blue chips, Maybank shed four sen to RM10.64, YTL Power dropped six sen to RM3.91 and CIMB dipped four sen to RM7.36.
MISC was up 14 sen to RM8.27, PETRONAS Chemicals gained 11 sen to RM5.69 and Hong Leong Bank rose eight sen to RM20.98.
Of actives, Tanco continued its rapid descent, hitting limit down after plunging 30 sen to 20 sen.
The share has been in free fall over the past week, and is currently trading at a fraction of its closing price of RM1.72 on June 4.
On Tuesday, the company announced it had entered into a memorandum of understanding with China Mobile International Limited to explore the development and building of a 50MW IT load data centre in Port Dickson, Negeri Sembilan.
Among other actives, MMSC rose 0.5 sen to 22.5 sen and Hong Seng was flat at one sen.
