KUALA LUMPUR: The FBM KLCI bounced back on Monday after a period of extended profit-taking in the previous week, but remained caught within a sideways trading channel.
At 12.30pm, the country’s main index had risen 8.34 points to 1,583.5, with further advance seemingly capped by the overhead 1,600 psychological resistance.
“From a technical standpoint, the benchmark index remains vulnerable to further retracements after cutting below the 25-day SMA line with the momentum indicator simultaneously reversing from the zero-line.
“On the other hand, the emergence of bargain hunters in search of buying opportunities may limit the market weakness.
“Hence, we reckon the FBMKLCI will probably continue to swing – with a slight negative bias – between our first support and resistance thresholds of 1,550 (S1) and 1,600 (R1) for the time being,” said Kenanga Research in its weekly outlook.
Over the coming week, investors will be anticipating the decision of the US Federal Open Market Committee meeting that will take place on Tuesday and Wednesday.
Back home, there could be portfolio rebalancing activities as the June semi-anniual review of the FBM Index series takes effect after market close on Friday.
In the morning session, leading blue-chip gainers included Maybank up six sen to RM8.24, Top Glove rising nine sen to RM4.81, Hartalega climbing 14 sen to RM8.44 and Maxis adding five sen to RM4.50.
Top actives on the broader market were Serba Dinamik falling five sen to 55.5 sen, KNM up one sen to 19 sen and Priceworth down 0.5 sen to 1.5 sen.
In regional markets, expectations that the US central bank will keep to interest rates near zero kept investor sentiment bullish for equities.
Japan’s Nikkei rose 0.6% and South Korea’s Kospi stayed mostly flat.
China’s composite index was down 0.6% while Hong Kong’s Hang Seng rose 0.4%.
Australia’s ASX200 gained 0.1%.