The FBMKLCI declined 2.80pt yesterday to close at 1,757.13, dragged down by selling pressure in the index stocks. Meanwhile, Asian equities rose, rebounding from their biggest weekly drop in four months, following stronger than expected US hiring data that boosted investor confidence in a global economic recovery. The MSCI Asia Pacific Index gained 0.3% to 153.22 as of 4:30pm in Hong Kong after falling 1.2% last week. The FBMKLCI’s top gainers were Petronas Gas (+2.3%), Hong Leong Financial Group (+1.5%) and MISC Group (+0.96%), while the top losers were Petronas Chemicals Group (-2.8%), Genting Bhd (-1.7%) and Astro Malaysia Holdings (-1.2%). In the broader market, losers outpaced gainers 556 to 294 with 351 counters unchanged. Turnover was 1.67b shares valued at RM1.52b. Based on the daily candlestick analysis, the FBMKLCI did not start the week on a positive note and tested the immediate support of 1,752 before paring down earlier losses to close at 1,757.13, which is slightly above the support level. The index slipped below both the 7- day and 21-day EMA lines yesterday, suggesting the short-term trend remains vulnerable to further correction. For now, the FBMKLCI is still above the long-term trendline but a further slip may change the overall bullish outlook to a much more neutral ground. Going forward, a negative closing below the immediate support should place more downward pressure on the index. Support and resistance levels are as follows:

• Support: 1,752,1,742
• Resistance: 1,787, 1,800

The Nasdaq and the S&P 500 finished higher Monday, with the Dow industrials closing fractionally lower as a pair of embattled sectors, technology and energy drew bidders. At the close in NYSE, the DJIA declined 0.03%, while the S&P 500 index climbed 0.09%, and the NASDAQ Composite index added 0.38%. Rising stocks outnumbered declining ones on the New York Stock Exchange by 1,588 to 1,524 and 134 ended unchanged; on the Nasdaq Stock Exchange, 1,532 fell and 936 advanced, while 140 ended unchanged.

Source: UOB Kay Hian Research - 11 Jul 2017