Bursa Malaysia expected to trend sideways next week

KUALA LUMPUR, Nov 14 — Bursa Malaysia is expected to trend sideways within a 1,660 — 1,680 trading band on the heels of sliding commodity prices and anticipation that the US Federal Reserve would hike interest rates next month.

Affin Hwang Investment Bank Vice-President/Head of Retail Research, Datuk Dr Nazri Khan Adam Khan, said the investment bank expects speculative stock play on the Trans Pacific Partnership Agreement (TPPA) and the return of a small cap rally on year-end window-dressing, as well as the festive season to cushion the broad market.

“The recent sharp fall in crude oil and industrial metal prices has set the tone for global equity markets, as commodity stocks come under pressure amid persistent concerns about the risks to China’s economy.

“Following the release of last week’s robust US jobs report and speculation on an interest rate hike, the S&P 500 finished 1.4 per cent softer, its worst showing since late September 2015.

“Stocks on Bursa meanwhile, have corrected 3.8 per cent since the October high of 1727,” he told Bernama.

On the domestic front, Nazri said several news headlines are likely to reduce market weakness and sustain the bullishness towards the year-end.

It includes the Malaysian Industrial Production Index which expanded 5.1 per cent year-on-year in September, far more than consensus expectations, suggesting an accelerated pick up in the economy despite global weakness.

“We also expect some good runs on the TPPA linked stocks as speculation intensifies on when Malaysia will join the historical FTA with twelve Pacific Rim countries after seven years of negotiations,” he highlighted.

On a weekly basis, the key benchmark FBM KLCI finished at 1,658.91, down 26.79 points from the 1,685.70 last Friday.

The FBM Emas Index decreased 166.86 points to 11,567.02, the FBMT100 Index depreciated 168.86 points to 11,238.32, the FBM Emas Shariah went down 121.69 points to 12,463.67, the FBM 70 slipped 146.94 points to 12,851.11, and the FBM Ace was 40.46 points lower at 6,395.98.

Sector-wise, the Finance Index gave up 236.83 points to 14,093.20, the Plantation Index contracted 191.92 points to 7,512.82, and the Industrial Index fell 51.28 points to 3,276.09.

Weekly turnover slipped to 8.79 billion units valued at RM7.99 billion from 12.54 billion units worth RM8.88 billion last week.

Main market volume slid to 5.40 billion units worth RM7.35 billion versus 7.67 billion units worth RM9.99 billion. Warrant turnover eased to 1.35 billion units worth RM617.52 million against 1.64 billion units worth RM248.39 million.

The ACE market depreciated to 2.03 billion units worth RM460.54 million from 3.23 billion units worth RM638.52 million. — Bernama

Source: http://www.themalaymailonline.com/money/article/bursa-malaysia-expected-to-trend-sideways-next-week#sthash.7y3nPEsf.dpuf