KUALA LUMPUR, Aug 27 — Bursa Malaysia is expected to retest the 1,700 psychological level next week, driven by optimism that the US Federal Reserve (Fed) will not increase interest rate as well as stabilising crude oil prices, a dealer said.

Affin Hwang Investment Bank Vice-President/Retail Research Head Datuk Dr Nazri Khan Adam Khan said the recent economic data from the US showed a strong growth in durable goods orders, while manufacturing data suggested the world’s largest economy was continuing its recovery.

He said despite the continuous improvement in the US economy, the Fed was not expected to raise interest rate in September to accommodate growth.

"The recent annual gathering of central bankers in Jackson Hole, Wyoming, US also showed that most central banks preferred a gradual interest rate hike and stimulus programme,” he told Bernama.

Meanwhile, Nazri Khan said crude oil prices remained above the US$45 per barrel, suggesting that the commodity is stabilising.

For the week-just-ended, the benchmark index failed to test the 1,700 points level on lack of catalyst as investors stayed sidelined to await Fed chair Janet Yellen’s speech on Friday.

On a Friday-to-Friday basis, the FBM KLCI eased 4.59 points to 1,683.09, the FBM Emas Index erased 50.16 points to 11,801.42, FBMT 100 Index declined 40.32 points to 11,514.58 and the FBM Emas Syariah Index decreased 56.24 points to 12,439.94.

On a sectoral basis, the Finance Index slid 36.23 points to 14,446.27, the Industrial Index fell 21.84 points to 3,153.28 and the Plantation Index shed 55.39 points to 7,806.67.

Weekly turnover decreased to 8.85 billion units worth RM8.26 billion from 13.31 billion units worth RM9.98 billion last week.

Main market volume declined to 5.50 billion shares valued at RM7.71 billion from 7.25 billion shares valued at RM9.06 billion previously.

Warrant turnover fell to 1.97 billion units worth RM289.18 million from 3.83 billion units worth RM446.97 million last week.

The ACE market shrank to 1.39 billion shares valued at RM264.78 million from 2.22 billion shares valued at RM463.08 million. — Bernama