Bursa Malaysia to retest 1,670 level as US job market softens, rate cut expectations rise. Attractive valuations offer buying opportunity. Focus on strong companies, defensive sectors.

Bursa Malaysia expected to retest 1,670 level next week as softening US job market keeps rate cut expectations elevated. Domestic market's recent setback offers buying opportunity due to attractive valuations. Investors advised to focus on fundamentally strong companies with high dividends and defensive sectors, while cautious of US data volatility.

Bursa Malaysia is expected to retest the 1,670 level next week, driven by improved market sentiment as the latest US jobs data points to a softening labor market. This keeps expectations for an interest rate cut by the US Federal Reserve elevated. The domestic market's recent setback offers a compelling buying opportunity due to more attractive valuations. However, investors should remain aware of the market's heightened sensitivity to US economic data. Rakuten Trade expects the FBM KLCI to trade within the 1,650-1,670 range, with support at 1,650 and resistance at 1,670. Investors are advised to focus on fundamentally strong companies with high dividend yields and defensive sectors, while remaining cautious of potential volatility due to US economic data.

Bursa Malaysia Poised to Retest 1,670 Level Amid Softening US Job Market

Bursa Malaysia is expected to retest the 1,670 level next week, driven by improved market sentiment as the latest US jobs data points to a softening labor market. This keeps expectations for an interest rate cut by the US Federal Reserve elevated.

According to UOB Kay Hian Wealth Advisors' head of investment research, the recent US nonfarm payrolls report showed a lower-than-expected increase in jobs, but the decline in jobless claims suggests the labor market slowdown is orderly. Despite the mixed economic data, recession concerns appear overstated, and the market sentiment is expected to gradually improve.

The domestic market's recent setback offers a compelling buying opportunity due to more attractive valuations. However, investors should remain aware of the market's heightened sensitivity to US economic data, as any deviation from the expected 50-basis-point rate cut this month could trigger volatility.

Rakuten Trade Sdn Bhd's equity research vice-president expects the FBM KLCI to trade within the range of 1,650-1,670 for next week, with immediate support at 1,650 followed by 1,630 and resistance at 1,670 followed by 1,700. The 20-day and 50-day exponential moving averages are both trending upward, signaling a continued bullish trend in the short and medium term, though the proximity to the 20-day EMA hints at potential consolidation.

Bursa Malaysia traded in the red for the entire week, as the softening US labor market sparked concerns over the global economic outlook. However, Bank Negara Malaysia's decision to keep the overnight policy rate unchanged at 3.00% provided some support to key heavyweights, mainly financial counters.

Investors are advised to focus on fundamentally strong companies with high dividend yields and defensive sectors, while remaining cautious of potential volatility due to US economic data. The overall market turnover slipped compared to the previous week, with decreases in Main Market volume, Warrant turnover, and ACE Markets volume, except for the ACE Markets volume, which increased.

Bursa Malaysia Poised to Retest 1,670 Level Amid Softening US Job Market

Bursa Malaysia is expected to retest the 1,670 level next week, driven by improved market sentiment as the latest US jobs data points to a softening labor market. This keeps expectations for an interest rate cut by the US Federal Reserve elevated.

According to UOB Kay Hian Wealth Advisors' head of investment research, Mohd Sedek Jantan, while the recent US nonfarm payrolls report showed a lower-than-expected increase in jobs, the decline in jobless claims suggests the labor market slowdown is orderly. Despite the mixed economic data, recession concerns appear overstated, and the market sentiment is expected to gradually improve.

Mohd Sedek noted that the domestic market's recent setback offers a compelling buying opportunity due to more attractive valuations. However, he cautioned investors to remain aware of the market's heightened sensitivity to US economic data, as any deviation from the expected 50-basis-point rate cut this month could trigger volatility.

In this context, Mohd Sedek expects a shift in investor focus towards fundamentally strong companies with high dividend yields and defensive sectors.

From a technical standpoint, Rakuten Trade Sdn Bhd's equity research vice-president, Thong Pak Leng, said the 20-day and 50-day exponential moving averages (EMAs) are both trending upward, with the index staying above them. This signals a continued bullish trend in the short and medium term, though the proximity to the 20-day EMA hints at potential consolidation.

Thong expects the FBM KLCI to trade within the range of 1,650-1,670 for next week, with immediate support at 1,650 followed by 1,630 and resistance at 1,670 followed by 1,700.

Bursa Malaysia traded in the red for the entire week, as the softening US labor market also sparked concerns over the outlook of the global economy. However, Bank Negara Malaysia's decision to keep the overnight policy rate unchanged at 3.00% provided some support to key heavyweights, mainly financial counters.

On a Friday-to-Friday basis, the FBM KLCI lost 25.68 points to 1,653.12 from the previous week's 1,678.80. The FBM Emas Index, FBMT 100 Index, and FBM Emas Shariah Index also declined, while the FBM 70 Index and FBM ACE Index were weaker.

Sector-wise, the Financial Services Index, Plantation Index, Industrial Products and Services Index, and Energy Index all retreated.

For the week, overall market turnover slipped to 14.90 billion units valued at RM15.33 billion, compared to 17.60 billion units valued at RM20.66 billion in the preceding week. The Main Market volume, Warrant turnover, and ACE Markets volume all decreased, except for the ACE Markets volume, which increased.

In summary, Bursa Malaysia is poised to retest the 1,670 level next week, driven by improved sentiment as the softening US job market keeps rate cut expectations elevated. Investors are advised to focus on fundamentally strong companies with high dividend yields and defensive sectors, while remaining cautious of potential volatility due to US economic data.