Bursa likely to test the 1,680 level

BURSA Malaysia is expected to trend higher this week with the FBM KLCI to hit the 1,680 level on better sentiment as the ringgit improves against the US dollar.

Affin Hwang Investment Bank vice-president and head of retail research Datuk Nazri Khan expected sentiment to improve after Donald Trump’s inauguration as US President and his speech was expected to provide more details on his government’s policies, including economic policy.

He said recent decisions by the European Central Bank to maintain its interest rate as well as optimism from the Japanese central bank and Bank Negara on their respective country’s economic growth would also help to improve sentiment.

“The fundamentals are there, it’s just the sentiment that keeps the local stock market subdued last week,” he told Bernama.

Nevertheless, he said the market bellwether FBM KLCI had improved 30 points or 1.8% this month, a good indication for the rest of the year.

He added that the support level for this week was seen at 1,660 and the resistance level at 1,680.

For the week just ended, the local index trended mostly lower, dominated by cautious sentiment on the US policy after Trump assumes office.

On a week-to-week basis, the FBM KLCI fell 7.61 points to 1,664.89 from 1,672.5 previously.

The FBM Emas Index shed 42.76 points to 11,668.55, FBMT 100 Index decreased 43.15 points to 11,372.54, FBM ACE fell 101.37 points to 4,985.8 and the FBM 70 declined 16.74 points to 13,346.94.

The FBM Emas Shariah Index was 78.87 points weaker at 12,157.94.

On a sectoral basis, the Finance Index eased 38.78 points to 14,707.21, the Plantation Index erased 21.94 points to 7,915.12 and the Industrial Index declined 44.55 points to 3,125.53.

Weekly turnover fell to 9.1 billion units worth RM8.25bil from 11.99 billion units worth RM9.69bil previous Friday.

Main market volume narrowed to 6.08 billion shares valued at RM7.74bil from 7.99 billion shares valued at RM8.98bil previously.

Warrant turnover shrank to 766.61 million units worth RM116.42mil from 866.07 million units worth RM142.42mil previous Friday. The Ace Market decreased to 2.23 billion shares worth RM392.53mil from 3.11 billion shares worth RM562.63mil previously. – Bernama