Wednesday, March 28, 2012

FBM KLCI Outlook: Cautious Sentiment To Prevail

Bursa Recap: KLCI drops 4.4 points, tracking sluggish regional markets
Led by a 2.7% plunge on SHCOMP, Asian markets were lower following announcement that National Bureau of Statistics showed a 5.2% slump in profits for China’s state enterprise combined earnings during the first two months of the year. Sentiment was cautious as risk-shy investors await fresh leads on growth prospects for the U.S. durable goods orders after a sluggish March’s consumer confidence index on Tuesday.

KLCI also lost 4.4 points, led by CIMB (-12 sen to RM7.50), IOICORP (-9 sen to RM5.28), TENAGA (-7 sen to RM6.42), MAYBANK (-2 sen to RM8.83) and PETGAS (-14 sen to
RM16.76).

FBM KLCI Outlook: Cautious sentiment to prevail
The KLCI is holding well above the uptrend line support or 30-d SMA (1572) during recent market consolidations. Looking at the chart, we believe prices could still make one more push towards historical high at 1597, but sustainability is suspect.

The key risk is that, if the candles fail to hold above the 1572 level, then most probably it will fall back towards 1549 (16 February pivot low).

Strategy wise, investors should capitalize further rallies to take profits and stay nimble, in the wake of volatile external markets as well as ahead of the looming 13th general election.

Daily KLCI - Crucial Uptrend Line (UTL) Support Near 30-Days SMA
FBM KLCI 29-03-2012



Source: HLIB Research

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