Bursa Malaysia to slow down on market uncertainties

Bursa Malaysia’s trading is forecast to slow down in the face of uncertainty in the emerging markets, escalating trade tensions and the extended weekend in the country, said dealers.

Bank Islam chief economist Dr Mohd Afzanizam Abdul Rashid said with investors remaining mindful of the external events, the FBM KLCI would linger around its resistance and support level of 1,805 and 1,776 respectively.

“In addition, the US non-farm payroll data is expected to show that the labour market in the US remains solid, which necessitates a rate rise in the US, while the Federal Open Market Committee will meet on September 26.

“The Fed is expected to deliver a 25 basis points hike in the Fed Fund Rate which currently stands at two per cent. This will add further pressure to emerging countries’ assets and currencies,” he told Bernama.

For the week just ended, Bursa Malaysia moved between 1,795.29 and 1,802.12, digesting the impact of the trade war on Malaysia, before snapping its three- day losing streak on Thursday and extending its momentum to Friday.

In the first three days, the local market was on a downtrend and attempted to break the negative trend but failed to do so, although however it broke the trend on Thursday.

M&A Securities Sdn Bhd chief daling officer R Sundararajah said the market is still on the sidelines for the week just ended, taking into account the long weekend next week.

“We can see a lot of investors are not taking a position, coupled with the composite index’s performance, which started last Monday’s trading at 1,819 and has dropped about 20 points since then.

“We also saw the net sell by foreigners which stood at RM602 million,” he said, adding that he anticipated the index to remain below the 1,800 level.

Sundararajah also said that investors would monitor the performance of Wall Street as well as regional markets on the first two days next week despite public holidays in Malaysia.

“We are following the same direction as Dow Jones and other Asian major economies and until then investors are unlikely to have an open position,” he said.

Bursa Malaysia will be closed on Monday and on Tuesday. Monday is a public holiday in lieu of the King’s birthday on Sunday and Tuesday is also a holiday for Awal Muharam, the Islamic New Year.

Compared to last Thursday, the benchmark FTSE Bursa Malaysia KLCI settled 20.49 points weaker at 1,799.17 on Friday.

The market was closed on last Friday for National Day.

The FBM Emas Index fell 156.99 points to 12,562.43 and the FBMT100 Index slipped 144.87 points to 12,381.56.

The FBM 70 gave up 189.23 points for 14,936.82, the FBM Emas Shariah Index decreased 123.54 points to 12,683.53, while the FBM Ace dipped 136.99 points to 5,146.72.

On a sectoral basis, the Finance Index declined 168.86 points to 17,796.11, the Plantation Index fell 72.75 points to 7,504.83, while the Industrial Index eased 0.41 point to 3,221.55.

Weekly turnover increased to 11.68 billion units worth RM10.15 billion from 10.65 billion units worth RM9.9 billion previously.

Main market volume declined to 5.66 billion shares valued at RM8.99 billion from last Friday’s 6.81 billion shares worth RM9.05 billion.

Warrants turnover improved to 2.98 billion units worth RM872.93 million from 1.8 billion units worth RM488.26 million.

The ACE market volume narrowed to 1.73 billion shares worth RM238.88 million from 2.03 billion shares valued at RM360.64 million.