Volatile trading ahead for KL bourse

Absence of positive news is expected to keep shares on Bursa Malaysia volatile next week with a possibility of the benchmark FBM KLCI testing the psychological 1,400 support level.

An analyst said players were likely to remain on the sidelines while awaiting fresh direction.

"Investors are monitoring the situation in Europe carefully before deciding whether to step into the market," he said.

Affin Investment Bank Head of Retail Research Dr Nazri Khan said the world economy was losing its momentum with the downgrade of two of France's top banks by Moody's leading to a deterioration in market sentiment.

"Nevertheless, although the current situation is dominated by negative catalysts, some investors have gained confidence on news that Germany and France are committed to support Greece to stay in the European Union," he told Bernama.

There had been speculation that Greece might pull out of the European Union amid worries of default on its debt.

Nazri said although external factors overweighed internal factors, investors would return to the market a week before budget day on Oct 7.

"We advise our clients to take defensive stocks like telecommunications and consumer-related stocks," he said, adding that the market was currently being dominated by defensive buying.

This week, the FBM KLCI dropped 38.19 points to 1,430.93.

The FBM Emas Index lost 298.10 points to 9,740.33, the FBM Top 100 Index declined 251.64 points to 9,568.82 and FBM ACE Index deceased 28.32 points to 3,749.49.

The Finance Index fell 354.17 points to 13,337.79, Plantation Index slipped 189.6 points to 7,16.24 and the Industrial Index was 64.92 points lower at 2,643.10.

The holiday-shorthened week saw total market volume decreasing to 2.88 billion shares valued at RM4.88 billion from 3.5 billion shares valued at RM6.29 billion previously.

The Main Market turnover fell to 2.20 billion units worth RM4.77 billion from 2.66 billion units worth RM6.124 billion.

Warrants decreased to 186.53 million units valued at RM14.139 million from 225.18 million shares valued at RM20.95 million.

Volume on the ACE Market declined to 474.33 million units worth RM78.5 million from 634.159 million units worth RM66.315 million.

Bursa Malaysia closed yesterday for Malaysia Day holiday. -- Bernama

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