Bursa Malaysia seen trading cautiously with upward bias next week

KUALA LUMPUR: Bursa Malaysia is expected to see cautious trading with an upward bias next week, buoyed by a promising domestic economic outlook despite volatility in regional markets, a dealer said.

Rakuten Trade Sdn Bhd vice-president of equity research Thong Pak Leng reckons that the FTSE Bursa Malaysia KLCI (FBM KLCI) index is likely to move between 1,540 and 1,560 going forward with the immediate resistance at 1,575 and support at 1,530.

He said the local market will see continued bargain hunting activities, given the cheap valuations of local stocks and the improving macroeconomic situation in the country.

“We are cautiously optimistic given the improvement in the local market sentiment. Nevertheless, investors will stay alert to the increasing market volatility and external uncertainties,“ he told Bernama.

On Wednesday, Bank Negara Malaysia (BNM) announced that the overnight policy rate (OPR) will be increased by 25 basis points to 2.00 per cent.

On Friday, BNM reported that Malaysia’s economy rebounded in the first quarter of 2022 (Q1 2022), expanding 5.0 per cent versus a contraction of 0.5 per cent in Q1 2021.

The central bank said the sustained reopening of the global economy and the improvement in labour market conditions have continued to support the recovery of economic activity and it expects the domestic economy to improve further this year, with growth projected to be between 5.3 per cent and 6.3 per cent in 2022.

For the week just ended, the FBM KLCI was traded mixed amid softer performance in regional markets and a decline on Wall Street as investors remained wary about faster interest rate hikes.

On a weekly basis, the FBM KLCI fell 19.93 points to end the week at 1,544.41 from 1,564.34 in the previous week.

On the index board, the FBMT100 Index fell 168.25 points to 10,687.26, the FBM Emas Shariah Index eased 225.34 points to 11,468.41, the FBM Emas Index slid 194.76 points to 11,010.80, the FBM ACE shed 154.63 points to 5,342.63 and the FBM 70 lost 329.46 points to 13,056.61.

Sector-wise, the Plantation Index lost 353.82 points to 8,179.28, the Industrial Products and Services Index weakened by 7.31 points to 196.79, and the Energy Index declined 8.93 points to 787.24.

The Financial Services Index trimmed 141.46 points to 16,534.37, the Healthcare Index shed 30.16 points to 1,980.94, and the Technology Index inched down 2.19 points to 65.69.

Weekly turnover widened to 15.15 billion units valued at RM11.21 billion against 5.79 billion units valued at RM4.81 billion last week.

The Main Market volume expanded to 10.68 billion shares worth RM10.33 billion versus 3.53 billion shares worth RM4.41 billion in the previous week.

Warrants volume improved to 1.46 billion units valued at RM256.93 million against 726.98 million units valued at RM130.71 million previously.

The ACE Market volume was higher at 2.99 billion shares worth RM621.60 million from 1.52 billion shares worth RM272.69 million the week before.

Bursa Malaysia and its subsidiaries will be closed on Monday, May 16 for a replacement holiday in conjunction with the Wesak Day celebration and will resume its operations on Tuesday, May 17.-Bernama