The FBMKLCI rose 2.95pt to close at 1,773.96, lifted by strong buying interest across the board as the index resumed its climb from last Wednesday. Meanwhile, stocks in Asia climbed with US equity-index futures and oil advanced to the highest in more than a month ahead of the key meeting from crude producing countries. The MSCI Asia Pacific Index jumped 0.8% to its highest level since May 15. The FBMKLCI’s top gainers were Genting Malaysia (+4.2%), CIMB Group Holdings (+3.1%) and Hong Leong Financial Group (+2.7%), while the top losers were Axiata Group (-4.4%), Astro Malaysia Holdings (-1.1%) and Westports Holdings (-0.80%). In the broader market, losers outpaced gainers 590 to 377 with 376 counters unchanged. Turnover was 2.95b shares valued at RM3.17b. From a technical perspective, a positive closing above the 7-day and 21-day SMA yesterday indicates a potential change in the outlook and the index direction from the current consolidation mode. The index is set to retest the immediate resistance of 1,787 in the near term, given the strong momentum as flashed by the RSI. Nevertheless, the medium-term outlook remains neutral, based on a consolidation range of 1,755-1,785 which if breached should translate into a stronger movement hereafter. Support and resistance levels are as follows:

• Support: 1,755,1,729
• Resistance: 1,787, 1,800

Minutes from the Federal Reserve's May 2-3 meeting, released on Wednesday, continued to bolster sentiment. The said minutes suggested there will be a very gradual and thoughtful balance sheet normalisation process. The DJIA rose 0.34 %, to 21,082.95, the S&P 500 index gained 0.44%, to 2,415.07 and the Nasdaq Composite 0.69%, to 6,205.26. Advancing issues outnumbered declining ones on the NYSE by a 1.08-to-1 ratio; on Nasdaq, a 1.15-to-1 ratio favored advancers.

Source: UOB Kay Hian Research - 26 May 2017