KUALA LUMPUR: The FBM KLCI looks set to continue its horizontal pattern as traders searched for new catalysts to dictate trading direction.
The country's key stock index closed nearly flat in the previous session as investors kept to a cautious stance ahead of more concrete developments in the Middle East and clues as to whether the Federal Reserve will hike rates in September.
According to Apex Securities, the chances of a interest rate hike in September have fallen to 52% from 67%, amid the ongoing tensions between the US and Iran.
While a resolution to the geopolitical conflict remains up in the air, the FBM KLCI eked out a 0.11% or 1.95-point gain to 1,737.32 in early Tuesday trading.
"For KLCI, elevated crude oil prices and geopolitical uncertainty could continue to drive near-term volatility, but resilient domestic economic conditions and sustained buying interest in selected heavyweights should provide support, with the local market expected to trade with a mild upward bias this week as investors remain selective and focused on fundamentally strong companies," said the Apex in its market outlook.
The research firm said technology counters may extend the strong performance seen in the previous session. Utilities could also remain in focus amid firm gains on likely defensive positining and energy could remains suported by higher crude oil prices.
Plantation and REIT counters on the other hand could remain soft after lagging the broader market.
On Tuesday, the early movers included Gamuda rising eight sen to RM4.52, YTL Power gaining eight sen to RM4.76 and IHH climbing 11 sen to RM8.46.
Meanwhile, the top active stocks were Dagang Nexchange
dropping 0.5 sen to 49.5 sen, TWL rising 0.5 sen to 2.5 sen and AMS jumping 2.5 sen to 48.5 sen.
