In tandem with the uptrend in regional markets, the FBMKLCI gained 2.78pt (+0.2%) to close at 1,778.65. Meanwhile, Asian shares mostly rose on Monday despite headwinds from a weekend missile test by North Korea and concerns over further spread of ransom ware cyber attacks globally. The MSCI Asia-Pacific Index gained about 0.2% percent at 4:24pm in Hong Kong, holding near a two year high. The FBMKLCI’s top gainers were MISC (+0.9%), Tenaga Nasional (+0.7%) and Genting Bhd (+0.7%), while the top losers were AMMB Holdings (-0.9%), British American Tobacco (-0.6%) and CIMB Group Holdings (-0.2%). In the broader market, losers outpaced gainers 508 to 421 with 372 counters unchanged. Turnover was 3.74b shares valued at RM2.99b. From a technical viewpoint, nothing has much changed in yesterday’s tight trading as we had expected the index to continue consolidating within 1,765 to 1,780. A breach at either end would, in our view, lead to a follow-through. For now, investors remain cautious, given the uncertain sentiments across the globe. Nevertheless, the FBMKLCI is now trading above both the 7-day and 21-day EMA lines and we expect the index to remain in sideway mode. Support and resistance levels are maintained as follows:

• Support: 1,740,1,729
• Resistance: 1,787, 1,800

US stocks closed higher on Monday, as risk-on sentiment returned, after a surge in tech and energy stocks, while a weaker-than-expected manufacturing print for May failed to weigh on sentiment. At the close in NYSE, the Dow Jones Industrial Average rose 0.41%, while the S&P 500 index added 0.48%, and the NASDAQ Composite index climbed 0.46%. Rising stocks outnumbered declining ones on the NYSE by 2,366 to 843, and 36 ended unchanged. On the Nasdaq Stock Exchange, 1,676 rose and 869 declined, while 88 ended unchanged.

Source: UOB Kay Hian Research - 16 May 2017