FBM KLCI to trade at 1,578-1,600 next week, healthcare, tech and small caps in focus

The benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) is expected to move between 1,578 and 1,600 points next week. — Bernama pic
The benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) is expected to move between 1,578 and 1,600 points next week. — Bernama pic

KUALA LUMPUR, Aug 8 — The benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) is expected to move between 1,578 and 1,600 points next week, with healthcare, technology-related and small cap counters anticipated to be on investors’ radar. 

Rakuten Trade Sdn Bhd head of research Kenny Yee Shen Pin said rotational play among targeted stocks would likely dominate market sentiment with trading volumes to remain high. 

“We think the market will probably will go through a similar trend, on the backdrop of heightened US-China trade tension, including on the technology issue,” he told Bernama. 

On a related note, AxiCorp chief global market strategist Stephen Innes said while regional markets are relatively a safer bet to trade than the US, traders would still need to be cautious when the US-China trade talks take place next week on August 15. 

“One can never be sure but I would expect the FBM KLCI to regain the 1,600-level next week on a favourable trade talk outcome between the two economic powerhouses,” Innes said, adding the stable and stronger ringgit would appeal to foreign investors to invest especially in health-related stocks. 

Meanwhile, Bank Islam Malaysia Bhd economist Adam Mohamed Rahim said the main focus next week will be the release of Malaysia’s second-quarter 2020 gross domestic product data on Friday, which is expected to decline further due to the impact of the movement control order (MCO).

“Nevertheless we believe that the market has somewhat priced this in. 

“We still expect the benchmark index to trade between the range of 1,550 and 1,600 next week, unless there are new positive catalysts such as breakthrough in vaccine development for Covid-19,” said Adam. 

For the week just ended, the key index FTSE Bursa Malaysia KLCI (FBM KLCI) was mostly lower, closing at 1,603.75, with an all-time trading volume high of 26.65 billion shares worth RM9.04 billion yesterday.

During the week, the market was heavily concentrated in the buying and selling of stocks in the healthcare, technology, FBM ACE, and the lower liners. 

On a Friday-to-Thursday basis, the index fell 25.61 points to end at 1,578.14 from 1,603.75 on Thursday the previous week. 

Bursa Malaysia Bhd and its subsidiaries were closed on Friday, July 31, 2020 for Aidiladha celebration.

On the scoreboard, the FBM Emas Index fell 47.56 points to 11,366.37, the FBMT 100 Index eased 75.27 points to 11,178.80, but the FBM Emas Shariah Index increased 58.02 points to 13,497.55.

The FBM 70 climbed 314.89 points to 14,810.47 and the FBM ACE Index soared 1,781.63 points to 10,316.51.

Healthcare index jumped 374.13 points to 4,301.40 and Technology index perked up 3.71 points to 54.74.

Sector-wise, the Financial Services Index shed 249.42 points to 12,916.09, the Plantation Index decreased 183.76 points to 6,963.75 and the Industrial Products and Services Index was down of 0.16 of-a-point to 140.97.

Weekly turnover surged to 87.66 billion units worth RM44.56 billion compared with 45.91 billion units worth RM26.58 billion in the previous week.

Main Market volume expanded to 42.45 billion shares valued at RM29.18 billion versus 20.61 billion shares valued at RM17.78 billion a week earlier.

Warrants turnover improved to 4.07 billion units worth RM1.64 billion from last week’s 3.84 billion units worth RM1.52 billion.

The ACE Market volume increased to 41.11 billion shares valued at RM13.72 billion compared with 21.44 billion shares valued at RM7.27 billion last week. — Bernama

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