The FBMKLCI added 2.56pt to close marginally higher at 1,776.31 yesterday as persistent buying interest slightly won over profit takers. Meanwhile, Asian stocks edged higher on Thursday as tensions between the US and North Korea came off the boil, while the Federal Reserve's concerns about weak US inflation weighed on the dollar. The MSCI Asia Pacific Index added 0.5%to 159.85. The FBMKLCI’s top gainers were Genting Malaysia (+1.9%), IJM Corporation (+1.8%) and Petronas Chemicals Group (+1.7%), while the top losers were Astro Malaysia Holdings (-1.9%), Petronas Gas (-1.2%) and KLCC Property Holdings (-1.0%). In the broader market, gainers outpaced losers 494 to 332 with 400 counters unchanged. Turnover was 1.80b shares valued at RM1.88b. Given the indecisive nature of the “spinning top” pattern registered and flattish signal in the RSI, we remain adamant that the current consolidation is part of the natural normalisation process in each market. Given a lack of fresh catalysts, we expect the FBMKLCI to move within the market range of 1,760 to 1,780 in the near term. However, the index continues to trade above the trendline, thus we opine that the upward movement should resume once selling pressure has eased. Support and resistance levels are as follows:

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

US stocks closed lower on Thursday as the recent controversies engulfing President Donald Trump raised concerns that his pro-growth policies could be delayed, offsetting upbeat reports indicating the economy continued to strengthen. At the close in NYSE, the Dow Jones Industrial Average lost 1.2%, the S&P 500 index declined 1.5% and the NASDAQ Composite index lost 1.9%

Source: UOB Kay Hian Research - 18 Aug 2017