The FBMKLCI added 2.91pt and closed at 1,739.05 yesterday, spurred by bargainhunting. Meanwhile, Asian shares edged higher while US Treasury yields and the dollar got a lift following a report that Republican senators were leaning toward John Taylor to be the next Federal Reserve chief. The FBMKLCI’s top gainers were Genting Malaysia (+2.6%), RHB Bank (+2.4%) and Astro Malaysia Holdings (+1.8%), while the top losers were British American Tobacco (-1.9%), AMMB Holdings (-0.9%) and IOI Corporation (-0.9). In the broader market, losers outpaced gainers 467 to 362 with 403 counters unchanged. Turnover was 2.46b shares valued at RM1.89b. From the technical viewpoint, the index formed an inside bar yesterday, thus temporarily halting the selling pressure from a day earlier. The index was still trading slightly below Ichimoku cloud while the RSI flashed an uptick, with the RSI line was still below the 50pt threshold, indicating the flat movement. Nevertheless, at the current level, the short- and medium-term outlooks remain negative, and we maintain our positive view over the long term given that the index remains above our long-term trendline. Support and resistance levels are as follows:

• Support: 1,729,1,713
• Resistance: 1,766, 1,778

US stocks were lower after the close on Wednesday, as losses in the telecoms, oil & gas and industrials sectors led shares lower. At the close in NYSE, the DJIA fell 0.48%, while the S&P 500 index declined 0.47%, and the NASDAQ Composite index lost 0.52%. Falling stocks outnumbered advancing ones on the New York Stock Exchange by 2,300 to 820 and 107 ended unchanged; on the Nasdaq Stock Exchange, 1,637 fell and 866 advanced, while 144 ended unchanged.

Source: UOB Kay Hian Research - 26 Oct 2017