KUALA LUMPUR: A shroud of uncertainty covers the investment landscape as investors grapple with the risk of US-Iran negotiations being derailed after the cancellation of the latest round of talks.
Apex Securities said market sentiment on the domestic market is expected to remain cautiously optimistic with Malaysia's inflation data coming in below market expectations, suggesting that price pressures rmeain manageable despite th external uncertainties.
"Continued investment activity and a healthy IPO pipeline are also expected to support investor sentiment. Nevertheless, local political uncertainties and continued foreign fund outflows may keep investors selective in the near term," it said in a market outlook.
In its sector outlook, the research firm said a more hawkish Federal Reserve could benefit export-oriented sectors if it leads to a stronger US-RM exchange rate, which would enhance the value of overseas earnings when translated into ringgit.
The REITs, however, could lose momentum as higher interest rates weigh on yeild attractiveness and increase financing costs.
At 9.07am, the FBM KLCI was down 4.33 points or a quarter percent to 1,707.7.
Apex Securities said the blue-chip index sits at a critical juncture following its previous close above the 20-day moving average.
"The rebound above both the 20-day and 120-day moving averages points to improving near-term sentiment, though the index remains capped below key resistance.
"Immediate downside risk has eased, but the Double Top pattern stays intact unless price breaks decisively above the key resistance at 1,720 – 1,740," it said.
Among the leading blue chips, Maybank fell eight sen to RM11.10, PETRONAS Dagangan slid 18 sen to RM18.56 and PPB shed 44 sen to RM9.68.
In active stocks, AirAsia X
was among the leading actives, falling five sen to RM1.28, as oil prices were seen moving higher after Iran once again shut down the Strait of Hormuz.
Capital A dropped 1.5 sen to 42.5 sen.
