Bursa Malaysia stays uninspired amid Middle East peace talks

KUALA LUMPUR: Despite rising hopes that tensions in the Middle East could de-escalate following a resumption of peace talks, there has been a lack of upward momentum on Bursa Malaysia.

The Malaysian benchmark stock index ended slightly higher in the previous session on late buying in plantations and telcos, but there was little price positivity to suggest a break out of the consolidation phase.

Notwithstanding a rebound in Wall Street markets overnight, the FBM KLCI stayed subdued on Tuesday, losing 1.17 points at the opening bell to 1,518.82.

According to Rakuten Trade, the rally is the US stock market was owing to Iran's efforts to end its conflict with Israel. However, the broker said it remained cautious as peace negotiations have yet to yield a conclusive outcome.

TA Securities Research struck a more optimistic note, saying the overnight rebound on Wall Street should revive the local market today. However, it also said the market undertone remained cautious amid the ongoing Middle East tensions.

"Immediate index support is kept at 1,490, while stronger supports can be found at 1,465 and 1,444. Immediate resistance stays at 1,564 with next upside hurdles seen at the recent high of 1,586, followed by 1,610 ahead," it said in its market commentary.

Malacca Securities Research, in its review, said there remained trading opportunities in the gold and oil and gas counters, as buying the commodities surged in light of the Middle East turmoil.

It added that Tenaga Nasional's RM43bil in spending on grid upgrades to support clean energy, coupled with policies like NETR and CRESS, should benefit local solar players in the long run.

"We favour Solarvest, which recently secured a 25-year power purchase agreement with the Brunei government for a 30MWac solar PV power plant, the largest solar PV plant in Brunei," it said.

The broker also recommended the plantations sector following the breakout in the crude palm oil price yesterday.

On Bursa Malaysia, there was some selling in oil and gas-related counters following the retreat in crude oil prices. Petron Malaysia shaved eight sen to RM3.94, Hengyuan dropped eight sen to RM1.83 and Hibiscus Petroleum fell eight sen to RM1.68. Bumi Armada lost five sen to 48 sen.