KUALA LUMPUR: BIMB Securities Research expects the Malaysian stock market to stage a technical rebound on Tuesday as investor sentiment could be boosted by the overnight surge on Wall Street.
Wall Street snapped its seven-day losing streak, as a recovery in oil prices and Warren Buffett’s acquisition of Precision Castparts boosted investor sentiment.
The DJIA gained 1.39% to end at 17,615.17 while the S&P 500 surged 1.28% to 2,104.18.
European markets also finished higher with Greece’s negotiations over a new bailout could conclude soon. Regionally, key indexes ended mostly positive, however, the outlook in China contrasted with solid US data with Chinese producer prices in July hit their lowest point since late 2009 and exports tumbled 8.3% in the same month.
BIMB Research said at Bursa Malaysia, the KLCI skidded 28.28 points to close at 1,654.37 as foreign outflow persisted.
Foreign funds were net sellers at –RM230.50mil on Monday. However, retail investors were net buyers at RM22.60mil and local funds at RM207.9mil.
“We reckon it (foreign selling) could also be due to the political undercurrent at the moment. Nevertheless, we expect the local market to gain buying