Bursa Malaysia started trading after the long holiday with a stronger performance, but investors remained cautious following the latest developments in the Middle East even though the Wall Street market continued to record new records in recent trading sessions.
The benchmark FBM KLCI index opened 4.06 points higher at 1,687.13 points, supported by positive sentiment from the rise in global technology stocks supported by the development of artificial intelligence (AI).
According to Apex Securities, investors' attention is now focused on several important US economic indicators, including the ADP employment report and non-farm payrolls data that will be announced in the near future. The data is expected to provide a clearer picture of the direction of the US Federal Reserve's (Fed) monetary policy.
Although the external environment is seen to be improving, the research firm expects the FBM KLCI to continue to move within a limited range due to cautious sentiment at the regional level and foreign fund flows that are still mixed.
From a technical perspective, Apex Securities saw less encouraging signs when the local market's main index formed a 'double-top' pattern after breaking through the main uptrend support level. This pattern is usually considered an early indicator of a possible change in market direction to a bearish phase.
According to the firm, if the index drops below the 1,680 point level, selling pressure is expected to increase and could cause the market to experience a larger decline. At the same time, the 1,700 point level remains the main resistance that needs to be broken to restore the upward momentum.
Among the largest stocks on Bursa Malaysia, Gamuda emerged as one of the companies that recorded the best performance when it jumped 15 sen. RHB also added 11 sen, while YTL Power increased nine sen. Nestlé shares recorded a significant increase of RM2.20. On the other hand, Maybank continued its downward trend when it fell four sen, while Maxis declined 21 sen.
For active stocks, Bus Capital stole the show on its first day of listing on the ACE Market when it rose seven sen to 30 sen after more than 34 million shares changed hands. NationGate rose eight sen to 96 sen, while CIMB rose three sen.
Overall, Bursa Malaysia started the trading session on a positive note, but investors are still taking a cautious approach in assessing global risks and the US economic developments which are expected to play an important role in determining the market direction in the near term.
