Thursday, February 23, 2012

FBM KLCI: Market Turns Cautious

Bursa Recap: KLCI down 3.3 points, snapping its 3-day rally
Asian markets ended mixed amid concerns of rising crude oil price and about the long-term feasibility of the Greek bailout after Fitch slashed its rating for Greek sovereign debt to “C” from “CCC,” indicating that default is “highly likely in the near term.”

Tracking regional markets, KLCI lost 3.3 points to 1560.5, dragged by plantation stocks such as IOICORP (-10 sen to RM5.34), PPB (-50 sen to RM17.14) and KLK (-36 sen to RM23.64) amid a disappointing Wilmar 4Q11 results. Market breadth was negative with 302 gainers as compared to 541 losers.

FBM KLCI Outlook: Market turns cautious
It seems the market is taking a breather and waiting for its next catalyst after the fine run YTD. A period of consolidation or even a slight pullback wouldn't be surprising given the overbought market conditions.

Overall, the rebound from 16 Feb’s low of 1549 points continues to be weak as broader market turns more cautious and trading volume shrank, suggesting that the rally is running out of steam. The KLCI is still below our envisaged resistance channels of 1570-1580 points. Supports fall on 14-d SMA (1554), 1550 and mid Bollinger band (1543).

Daily KLCI - Moving Range Bound Within The Uptrend Channel
FBM KLCI 23-02-2012



Source: HLIB Research

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