Bursa Malaysia expected to trend sideways next week

KUALA LUMPUR: Bursa Malaysia is expected to trade sideways next week, with the benchmark index moving between 1,770 and 1,780 points due to mixed market sentiment from both local and external factors.
Affin Hwang Investment Bank Vice-President and Head of Retail Research, Datuk Dr Nazri Khan Adam Khan, said the market would remain cautious following the tension in the Korean Peninsular which would continue to take centre stage and weighed on market sentiment.
There were some speculations that Pyongyang might try another missile launch on its national day on Saturday.
He said regional bourses were also expected to be defensive after the European Central Bank’s meeting hinted it might taper stimulus plan in October.
On the another note, the market would also keep a cautious eye on Hurricane Irma to weigh its impact on Wall Street sentiment.
On the local front, the ringgit hit a one-year high against the US dollar at 4.1820 on Thursday, inflation had moderated while Malaysia’s trade surplus had risen sharply to RM8.03 billion on stronger exports which reflected the good economic data locally, Nazri Khan said.
“Based on these, shares on Bursa Malaysia are expected to be well supported by good local sentiment, while the external headwinds could spark negative sentiment, prompting the market to move sideways,” he told Bernama.
He added there were also evidenced that the local institutions were “buying on dips” in supporting the market.
For the week just-ended, the benchmark FTSE Bursa Malaysia KLCI gained 6.74 points to 1,779.9 from 1,773.16 last week.
Bursa Malaysia’s trading movement was influenced by external factors, particularly the movement on Wall Street which took into account the impact of the hurricane on the US economy, issues of the Federal Reserve Chair Janet Yellen’s successor and the geopolitical tension with North Korea.
On a weekly basis, the FBM Emas Index was 79.21 points higher at 12,689.28 and the FBMT 100 Index rose 75.86 points to 12,357.52.
The FBM Emas Syariah Index advanced 137.05 points to 12,886.14, the FBM 70 jumped 202.45 points to 15,262.29 and the FBM Ace gained 36.84 points to 6,649.58.
On a sectoral basis, the Finance Index was down by 45.78 points to 16,726.53, but the Industrial Index edged up 7.58 points to 3,208.72, and the Plantation Index added 41.75 points to 7,890.21.
Total turnover increased to 10.34 billion units valued at RM8.66 billion from 5.06 billion units valued at RM5.69 billion.
Main Market volume widened to 6.62 billion shares worth RM7.98 billion from 3.13 billion shares valued at RM5.3 billion.
Warrants volume rose to 633.87 million units worth RM81.02 million from 522.86 million units valued at RM69.06 million.
The ACE Market turnover jumped to 3.01 billion shares valued at RM590.80 million from 1.39 billion shares valued at RM317.30 million.
The gold futures contract on Bursa Malaysia Derivatives is expected to be firm next week in tandem with the steady New York Commodity Exchange gold futures market.
Phillip Futures Sdn Bhd Dealer, Chang Hui Ying, said weak United States economic data had seemingly reduced the expectations of another interest rate hike this year, driving investors to flee to safe-haven assets such as gold.
"Market participants will be looking to the interest rate decision by the Bank of England next week," Chang told Bernama.
However, any further upside for the local gold futures would be capped by the anticipation of a stronger ringgit performance against the US dollar next week.
The market was closed on Thursday and Friday last week and on Monday this week for public holidays.
On a Friday-to-Wednesday basis, Sept 2017, Oct 2017 and Nov 2017 rose 27 ticks each to RM180.85 a gramme, RM180.35 a gramme, RM180.55 a gramme, respectively, while December 2017 improved 29 ticks to RM179.45 a gramme.
Weekly turnover fell to 24 lots worth RM436,110 from 100 lots worth RM1.79 million in the previous week while open interest eased to 145 contracts from 214 contracts. — Bernama