KUALA LUMPUR, May 21 — Bursa Malaysia is expected to trend lower next week given the cautious and softer tone in being influenced by the US stock markets, said analyst.

“Given the weak technicals, we also continue to believe the FTSE Bursa Malaysia KLCI is yet to bottom-basing and could stage further weakness if the ringgit and commodities continue to fall,” said Affin Hwang Investment Bank Vice-President and Retail Research Head, Datuk Dr Nazri Khan Adam Khan.

Bottom basing is an example of a current sideways price pattern that is becoming a common bottom.

The big focus in global stock markets is the shift in expectations that US interest rates could rise earlier than previously expected.

The minutes from the Federal Reserve’s April policy meeting made it clear that a June increase remained firmly on the cards, he told Bernama.

He said on the domestic front, three major headlines are likely to cushion market weakness.

“Malaysia’s balance of payments for the first quarter, which showed the current account surplus had narrowed to RM5.0 billion or 1.7 per cent of gross domestic product (GDP) after rising in the previous quarter to RM10.5 billion or 3.5 per cent of it.

“Then, Bank Negara Malaysia’s action of maintaining the overnight policy rate at 3.25 per cent, meeting market expectations and sending accommodative signals to support economic activity.

“Thirdly, the government announced that Malaysia would remain in the Trans-Pacific Partnership Agreement (TPPA) and is set to complete the domestic ratification process for it by mid-2017.

“The announcement should catalyse exporters stocks which benefit strongly from the conclusion of the TPPA,” he added.

On a weekly basis, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) gained 0.53 of-a-point to 1,628.79 from 1,628.26 last week.

The FBM Emas Index added 7.83 points to 11,409.72, the FBMT100 Index rose 9.17 points to 11,099.39 and the FBM Emas Shariah Index was 24.24 points higher at 11,930.02.

On a sectoral basis, the Finance Index fell 56.71 points to 14,248.32, the Plantation Index edged upward 7.19 points to 7,462.65 and the Industrial Index improved 37.88 points to 3,068.37.

Weekly turnover decreased to 8.41 billion units valued at RM8.85 billion from 8.86 billion units worth RM10.10 billion last Friday.

Main market volume fell to 5.34 billion units valued at RM8.23 billion versus 5.46 billion units worth RM9.43 billion.

Warrant turnover declined to 628.75 million units valued at RM94.24 million against 824.67 million units worth RM107.92 million.

The ACE market slid to 2.42 billion shares valued at RM530.19 million from 2.56 billion shares worth RM557.54 million. — Bernama