Affin Investment Bank’s head of retail research, Nazri Khan, said that the market was going into a tough phase right now amid a mixed package of news and data.
“On one end, investors’ confidence is boosted by stellar financial results by US corporates but concerns are still weighing on the sustainability of the US economic recovery, the liquidity of the greenback and rising commodity prices triggering global inflation worries,” he said.
He expected the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) to move between 1,540 and 1,550 on external leads amid the absence of catalyst on the local front coupled with a holiday shortened week.
Bursa Malaysia will be closed on Monday in lieu of Labour Day falling tomorrow.
Nazri said the real driver of the market would still be the strengthening ringgit.
At 5pm yesterday, the ringgit continued its rally against the greenback to close at another new 13-year high of 2.9600/9620, against 2.9647/9667 on Thursday.
He said Bank Negara Malaysia was expected to raise the overnight policy rate by 25 basis points after its monetary policy meeting next week, and the market had taken that into account.
“Besides that, the signing of bilateral agreements between China and Malaysia in key sectors like energy, infrastructure and communication would revitalise the market further,” he added.
Meanwhile, Jupiter Securities head of research Pong Teng Siew said the benchmark index might consolidate further within the range of 1,515 to 1,530.
“I think that we are at the tail end of the bull market, and from now on investors need to be specific in what they invest to reap returns.
“There is still money to be made, but they need to study carefully before investing as stock picking is very crucial at this stage,” he said.
This week, the market staged a mini rally for four days consecutively before paring gains yesterday.
On a weekly basis, the key index increased by 12.2 points to 1,534.95 from 1,522.75 the previous Friday.
The Finance Index gained 106.43 points to 14,039.16, the Industrial Index rose 35.29 points to 2,792.37 points and the Plantation Index inched up 1.43 points to 7,589.85.
The FTSE Bursa Malaysia Emas Index increased to 10,576.09 from 10,518.13 but the FTSE Bursa Malaysia Ace Index eased to 4,387.50 from 4,408.25.
The weekly volume declined to 5.007 billion shares worth RM4.901 billion from 5.873 billion shares worth RM7.408 billion.
The Main Market turnover declined to 3.705 billion shares valued at RM6.139 billion from 4.056 billion shares valued at RM5.316 billion.
Volume on the ACE Market decreased to 974.502 million shares worth RM182.796 million from 1.390 billion shares worth RM279.745 million previously.
Warrants fell to 310.393 million units worth RM61.455 million from 417.454 million units valued at RM87.691 million.