KUALA LUMPUR: Stocks on Bursa Malaysia slid further on Friday after the previous day's decline as surging oil prices raised inflationary risks and the growing likelihood of a US rate hike in September.
According to Apex Securities, the return of West Texas Intermediate crude above US$100 and US Treasury yields hitting new highs raise the stakes ahead of Friday's crucial US consumer price index report.
"We stay cautious on near-term global risk appetite, as the combination of surging oil prices, rising Treasury yields, and an increasingly hawkish rate outlook creates a fragile backdrop heading into the pivotal inflation print and next week's Fed decision.
"For the KLCI, we expect sentiment to remain cautious in the near term, as elevated crude prices continue to raise cost pressures across the broader market, with investors awaiting greater clarity on the West Asia conflict and the US interest-rate outlook," it said.
In its technical reading, the research firm said the index has fallen below its 9-, 20- and 120-day exponential moving averages, which signals the near-term rebound has lost momentum and the broader uptrend structure is starting to weaken.
"A decisive break below 1,700 would open the door to a retest of 1,685, while failure to hold that level risks exposing the index to a slide back towards the 1,640–1,660 zone," it added.
At 9.08am, the FBM KLCI was down 3.18 points to 1,702.34. Lagging blue chips included IHH falling seven sen to RM7.82, Press Metal
sliding nine sen to RM7.77 and YTL Power dropping seven sen to RM5.67.
Glove makers have continued to see buying interest, with Top Glove topping the actives list with 19 million shares traded. Shares in the world's largest glove manufacuter rose 1.5 sen to 78 sen.
Supermax rose one sen to 44 sen and Hartalega gained five sen to RM1.16.
