KUALA LUMPUR: The FBM KLCI is anticipated to trend within the range of 1,671-1,700 next week as investor sentiment is expected to improve regionally and globally, said Rakuten Trade Sdn Bhd equity research vice-president Thong Pak Leng.
He said the market undertone is expected to remain steady on the domestic front, and the index is likely to stay positive.
"Nevertheless, we cannot rule out the possibility of some profit-taking. The FBM KLCI has shown a strong upward trend, trading well above both the 20-day exponential moving average (EMA) and the 50-day EMA lines, indicating robust bullish momentum in the short term.
"The widening gap between the index and these moving averages further confirms the strength of the current uptrend," he told Bernama.
On the other hand, Thong said the FBM KLCI might face resistance at 1,680 and the psychological 1,700 level.
"Conversely, the crucial support levels are at 1,635, followed by 1,620. Falling below these EMAs could suggest a weakening of the bullish momentum and a potential shift towards consolidation or a bearish trend.
"Overall, the outlook remains positive as long as the index stays above its critical support levels, but caution is advised as the market nears overbought territory," he added.
UOB Kay Hian Wealth Advisors head of investment research Mohd Sedek Jantan said the index could reach the psychologically important 1,700 level in the near term.
"We remain optimistic and maintain our forecast of 1,735 by the end of this year," he told Bernama.
Mohd Sedek said across Bursa Malaysia's sector indices on Friday, the industries connected to the data centre supply chain, including properties, technology, utilities, and construction, posted notable gains.
"This was in response to a record-breaking session on Wall Street, spurred by strong US economic data, including better-than-expected second-quarter gross domestic product growth and a decline in jobless claims, bolstering investor sentiment towards the global economic recovery," he added.
On a Friday-to-Friday basis, the FBM KLCI increased by 43.06 points to 1,678.80 from last week's 1,635.74.
On Aug 27, Bursa Malaysia hit another 44-month high and recorded a near 45-month high on the next day (Aug 28), fuelled by a surge in sentiment within the financial sector, underpinned by the robust quarterly earnings reports from key players as well as solid global chipmaker Nvidia Co's earnings results.
However, the FBM KLCI pulled back after a three-day rally on Aug 29, due to profit-taking, but the index position managed to hover above the 1,636 support level.
On Bursa Malaysia's index board, the FBM Emas Index rose by 150.45 points to 12,484.26, the FBM Emas Shariah Index increased by 24.62 points to 12,286.67, the FBM 70 Index declined by 270.51 points to 17,443.92, and the FBM ACE Index dropped by 99.60 points to 5,116.09.
Meanwhile, the FBMT 100 Index rose by 174.18 points to 12,187.62.
Sector-wise, the Financial Services Index surged by 696.88 points to 19,717.53, the Plantation Index soared by 113.02 points to 7,313.19, while the Industrial Products and Services Index retreated by 0.20 of-a-point to 181.40 and the Energy Index put on by 5.17 points to 926.7.
For the week just ended, turnover slipped to 17.60 billion units valued at RM20.66 billion versus 18.63 billion units valued at RM17.64 billion in the preceding week.
The Main Market's volume increased to 10.26 billion shares worth RM19.34 billion against 10.21 billion shares worth RM16.06 billion a week ago.
Warrants turnover dropped to 4.87 billion units valued at RM580.71 million from 5.63 billion units valued at RM650.47 million last week.
The ACE Market's volume decreased to 2.44 billion shares worth RM740.85 million from 2.76 billion shares worth RM932.47 million previously.