KUALA LUMPUR (Jan 6): The main index at Bursa Malaysia started Wednesday on a muted tone, tracking regional markets, as key index-linked stocks fell.
At 9.10am, the FBM KLCI lost 76.73 points to 1,601.62.
The early decliners included Carlsberg Brewery Malaysia Bhd, Hong Leong Financial Group Bhd, Hong Leong Bank Bhd, United U-Li Corp, IHH Healthcare Bhd, Public Bank Bhd, Tenaga Nasional Bhd and BIMB Holdings Bhd.
Bloomberg said Asian stocks were off to a muted start Wednesday as traders awaited the outcome of key elections in Georgia that could have implications for President-elect Joe Biden’s agenda.
Inter-Pacific Research Sdn Bhd said the FBM KLCI managed to turn around and returned to the positive territory yesterday as renewed buying on the beaten down glovemakers allowed the key index to regain some traction.
It said bargain hunting on the glovemakers were prevalent in the afternoon session and coupled with the gains in selected index-linked stocks, helped to mask the still mostly negative market breadth as both traded volumes and value tapered again.
In its daily bulletin today, the research house said the FBM KLCI could be looking to find some measure of stability after its weakness over the past few weeks with yesterday’s rebound.
It said part of the recent weakness was due to the resumption of the regulated short selling and the apprehension over glovemaker stocks with the Covid-19 vaccine availability.
“However, with the key index already nearing oversold, we see increased bargain hunting actions that would help to provide support, even as there is still some tentativeness among market players.
“While we see the key index building on the yesterday’s recovery, we also think that the near-term gains could be capped by the ongoing domestic political uncertainties that could still leave many market players on the sidelines.
“As such, we think the FBM KLCI may only head up to the 1,615-1,620 levels for now, with further hurdles at 1,630 and 1,642 respectively.
“The 1,600 level is still the immediate support, followed by yesterday’s low of 1,589 points.
“Conditions elsewhere remain mostly rangebound with sustained support on most of the lower liners and broader market shares. As we have noted, these stocks are at the crossroads after their strong 2020 performances with further upsides delayed until corporate earnings catch-up. At the same time, there is also little selling reassure on sustained support from retail players,” it said.- The Edge Market