Bursa downtrend likely to continue
Published on: Monday, December 17, 2018
Kuala Lumpur: The downtrend on Bursa Malaysia is likely to continue this week, with the composite index to remain below the 1,700-points level, weighed by volatility in the external market.Inter-Pacific Securities Sdn Bhd Head of Research Pong Teng Siew said sentiment in the market would be heavily shaped by market activity (buying/selling) among foreign investors who have expressed concerns over the global investing landscape, especially the progress on the US-China trade tensions. "I think external developments will have more influence on Bursa as local investors will be very cautious amid news that TH (Lembaga Tabung Haji) is preparing to sell a substantial portion of its portfolio in the market, especially the small-capitalisation stocks.ADVERTISEMENT "We can expect a round of selling to emerge if TH executes its plan," he told Bernama.TH had reportedly said it would reduce exposure in the equity market as part of the pilgrimage fund's turnaround plan to boost its financials."TH's (decision) will affect local players' sentiment, because foreign (investors), I believe already have more positive views on Malaysia."They realise that Malaysia is one of the few emerging markets that has consistently recorded current account surpluses," he said.ADVERTISEMENT By market capitalisation, the pilgrimage fund's largest exposure currently are in small-capitalisation stocks which account for 53.8 per cent, large-capitalisations constitute 19 per cent, micro-capitalisations (14.8 per cent) and mid-capitalisations (12.4 per cent).He said the first resistance level for the FTSE Bursa Malaysia KLCI (FBM KLCI) this week would be at 1,669, followed by 1,675 and 1,686, while immediate support levels are at 1,659, followed by 1,655, and 1,644.
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"I hope there will be window dressing towards year-end to spike the market and the change in sentiment towards Malaysia among the foreign fund (managers), if it continues, will be a lot more positive than what we have at the moment," he pointed out.Stay up-to-date by following Daily Express’s Telegram channel.
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For the week just-ended, Bursa Malaysia traded mostly lower on external factors, including investors' volatile sentiment on the ongoing US-China trade deal, as well as worries over the growth of the world's second largest economy. – BernamaPhoto Source : BursaMalaysia