The FBMKLCI lost 3.68pt to close at 1,735.84 yesterday. Meanwhile, Asian stocks fell as Chinese shares slumped and the yen weighed on Japanese equities. Treasuries climbed amid growing caution about geopolitical risks and the path of US interest rates. The FBMKLCI’s top gainers were Genting Bhd (+0.54%), Maxis (+0.47%) and Telekom Malaysia (+0.32%) while the top losers were KLCC Property Holdings (-2.0%), IOI Corporation (-1.9%) and Petronas Chemicals Group (-1.3%). In the broader market, losers outpaced gainers 569 to 358 with 364 counters unchanged. Turnover was 4.23b shares valued at RM2.57b. Despite the long-term trend remaining bullish, the index may be vulnerable to further corrections; the index showed a weaker signal after forming a bearish candlestick yesterday. Nevertheless, as the index remains within the upward “price channel”, we remain optimistic. Normalisation of current selling pressure may place the index back on an uptrend. As such, we expect the index to retest the immediate support at 1,729, which if breached, may lead towards further downside to support level at 1,713 over the near term. Support and resistance levels are as follows:

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

U.S. stocks slid as investors assessed geopolitical risks and Federal Reserve Chair Janet Yellen’s comments on the central bank’s priorities. The S&P 500 lost 0.14 percent to 2,353.78. The benchmark ended little changed on Monday, after paring an earlier advance. The Dow Jones Industrial Average lost 0.03 percent to 20,651.

Source: UOB Kay Hian Research - 12 Apr 2017