The FBMKLCI declined 2.20pt to close at 1,739.52 yesterday on profit-taking activity seen across index-linked counters. Meanwhile, most Asian stocks rose, with a falling yen pushing shares higher in Japan, as investors weighed the impact of the American jobs report and the path for US monetary policy tightening. The MSCI Asia Pacific Index was down less than 0.1%. The FBMKLCI’s top gainers were KLCC Property Holdings (+1.3%), Axiata Group (+1.2%) and Hong Leong Financial Group (+1.1%) while the top losers were Genting Bhd (-1.4%), Maxis (-0.94%) and Kuala Lumpur Kepong (-0.89%). In the broader market, losers outpaced gainers 468 to 430 with 381 counters unchanged. Turnover was 3.66b shares valued at RM2.10b.

Given yesterday’s negative closing, the index has formed a “spinning top pattern”, signaling indecisive movement and a potential pullback in the near term. However, a downward follow-though must be established before the signal can be considered valid. At the moment, a pullback is expected, thus the immediate support of 1,729 plays a crucial role in determining the change of the trend direction. We maintain our view of a bullish outlook over the long term as the index is still trading in rising channel trendline. Support and resistance levels are still maintained as follows:

• Support: 1,729,1,713
• Resistance: 1,760, 1,787

The DJIA gained 0.01% to 20,658.02 and the S&P500 edged higher by 0.07%, to 2,357.16. The NASDAQ Composite index gained 0.05% to settle at 5,880.93

Source: UOB Kay Hian Research - 11 Apr 2017