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Market Pulse
Daily updates brought to you by Malacca Securities. 

FMB KLCI - DAILY - 15/2/2018



Indifferent End to the Week
• The local key-index closed 0.2% higher after flitting in-and-out of the red, supported by gains IHH Healthcare and selected telco giants. Most of the lower liners continued its ascent, with the exception of the FBM Ace (-0.1%). More than half of the sub-sectors rallied, with the Energy (+4.2%) sector at the helm.

• Market breadth was positive with 463 gainers vs. 359 losers, while traded volumes surged 47.7% to 3.89 bln shares, boosted by the sharp rally in energy stocks following stronger crude oil prices.

• Significant key-index winners on Thursday were Nestle (+80.0 sen), IHH Healthcare (+20.0 sen), Petronas Dagangan (+12.0 sen), Genting (+8.0 sen) and Axiata (+6.0 sen). Other advancers, meanwhile, include Carlsberg (+82.0 sen), Fraser & Neave (+52.0 sen), Batu Kawan (+34.0 sen), Heineken Malaysia (+28.0 sen) and Petron Malaysia (+22.0 sen).

• In contrast, plantations-related companies like United Plantations (-54.0 sen) and PLS Plantations (-17.0 sen) weighed on the broader market, trailed by Malaysian Pacific Industries (-16.0 sen), Shangri-La Hotels (-15.0 sen) and Syarikat Takaful Malaysia (-10.0 sen).  Malaysia Airports (-6.0 sen) led the major decliners, alongside Tenaga Nasional (-4.0 sen), Kuala Lumpur Kepong (-2.0 sen), Public Bank (-2.0 sen) and Petronas Gas (-2.0 sen).

• Asian shares ended with minor losses as investors took a breather from the recent rally amid a flurry of regional economic data and global trade uncertainties. The Nikkei flatlined, while the Shanghai Composite (-0.1%) ended its five-day winning streak, inching into the red despite stronger-than-expected trade data.  The Hang Seng Index also narrowed 0.2% to 28,432.1 points, while the ASEAN stockmarkets ended mixed.

• U.S. key indexes drifted into the negative territory, dragged down by losses in consumer products and banking-related stocks. The Dow (-0.4%) and the S&P 500 (-0.3%) clawed back earlier losses, albeit still closing the red. In contrast, the Nasdaq inched higher by 0.1% on Thursday.

• U.K.’s blue-chip bourse - The FTSE (+0.1%) eked out gains in the final hour, as investors digested upbeat 4Q2018 earnings from drug makers like AstraZeneca. The CAC and DAX, however, weakened by 0.3% and 0.7% respectively after the U.S. posted its biggest annual slowdown in retail sales in more than nine years, renewing expectations of a slowing economy.



THE DAY AHEAD


• The market is still devoid of impetuses to allow the key index to break its spell of indifferent trend and this means that the immediate market is likely to stay rangebound for longer. The release of the country’s GDP performance for 2018 is unlikely to inspire much fresh buying as the prognosis for 2019 remains challenging. 

• Consequently, we think that the key index will again linger within the 1,680 and 1,690 levels amid the lack of direction.  At the same time, there is still some measure of cautiousness as the ongoing round of corporate results has been largely insipid, providing few catalyst for market players to chase. Apart from the above levels, the other support and resistance levels are at 1,683 and 1,692 respectively. 

• Meanwhile, the FBM Small Cap index is already overbought after its recent uptrend. Therefore, we think that the upsides are limited as a pullback is already due. The broader market is also set for a mixed trend after attaining substantive gains in the recent rally. 


 

The Market Pulse is a proprietary report courtesy of Malacca Securities Sdn Bhd (a participating organisation of Bursa Malaysia Securities Berhad) and has been abbreviated by Focus Malaysia. The report is for information purposes only and is not a recommendation to buy or sell any securities or financial instruments.

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