Bursa undergoes consolidation as investors digest gains

KUALA LUMPUR: The breather on Bursa Malaysia as investors take profits off the table are seen as a healthy development for the market given the recent strong uptrend.

At 9am, the benchmark FBM KLCI was down 1.79 points to 1,449.45, extending the selling from the previous session. Foreign investors ended six days of net inflow yesterday in a sign the market was ready to consolidate after rallying to its highest in five months.

“We opine that the pullback is healthy to allow recent gains to be digested. The lower liners are also experiencing a consolidation with traders opting for the wait-and-see approach ahead of the Malaysia state election,” said Malacca Securities Research in a note.

The research firm that there are signs of emerging volatility, which suggests a return to defensive stocks such as healthcare, utilities and REITs.

Meanwhile, TA Securities Research also remained optimistic that the improving investor sentiment over improving US economic data would help to cushion the current downward retracement.

“On the index, next resistance is at 1,470, with the 1,490/1,500 level acting as tougher upside hurdle.

“Key resistance-turn-support from the 200-day moving average at 1,436 will be crucial to cushion profit-taking dips, with lower key supports at 1,420 and 1,400,” it said in its technical outlook.

Banks led the decline on the market today as Maybank shed four sen to RM8.95 and CIMB slid five sen to RM5.47.

PETRONAS Chemicals was down six sen to RM6.79 and Tenaga Nasional lost three sen to RM9.52 while CelcomDigi fell three sen to RM4.39.

Technology counters were hit by the fall on the Nasdaq Index overnight, with MPI slipping 16 sen to RM28.84, Dufu losing seven sen to RM1.83 and MI Technovation falling five sen to RM1.54.

Among actives, Revenue was up 0.5 sen to 26.5 sen, EP Manufacturing rose 6.5 sen to 99 sen and Tanco was down 0.5 sen to 54 sen.