Next week at KLSE by Dr.Nazri

Bursa to continue downside next week

KUALA LUMPUR -- Bursa Malaysia is expected to continue its downside next week, dampened by the investors' wait-and-see attitude, profit-taking and traders' caution ahead of 13th general elections (GE13).

 Affin Investment Bank head of retail research, Dr Nazri Khan, said the local bourse, which was expected to touch the 1,620 level, however, will see moderate bargain hunting, especially among property and plantation counters.
 "Hence, we expect the local sentiment to be cautiously volatile, with alternating up and down FBM KLCI swings, ahead of the impending dissolution of parliament, which should be weeks away to pave the way for GE13. 
 "Further, the strength in the US dollar, softer ringgit and weaker commodities are another drags capping local equity upside," he told Bernama.
   Nazri said buying momentum and market breadth remained weak with the KLCI sliding 1.5 per cent from last week's high of 1664.39.
   He said based on historical trends, any downside and weakness weeks before GE were good buying opportunities. 
 "The FBM KLCI will generally soften before the general election, stabilise immediately after and hit a new high within three months after the election," hesaid.
   Although many investors were adopting a wait-and-see attitude currently,Nazri said, now was the best time to invest in quality local blue-chips. 
 "We expect most investors, especially foreign and high-end retail, to jumpback into the stock market immediately after the elections, pushing the local bourse higher in the early second half this year. 
 "We also see impressive strengths in our regional neighbours' stocks, which means Bursa Malaysia will play strong catch-up post-election," he said.
   Malaysia's better-than-expected fourth quarter 2012 gross domestic productgrowth and the expected resilient in the 2013 first quarter's earning resultsshould continue to support further upward revisions and higher stock price post-election, Nazri said.
 "Based on these resilient fundamentals, we are pegging 1,720 as our AffinInvestment Bank official target (post-GE) for the FBM KLCI by year-end which again means that now is an opportune time to accumulate stocks," he said.  - Bernama

Read more: Bursa to continue downside next week - Latest - New Straits Times http://www.nst.com.my/latest/bursa-to-continue-downside-next-week-1.235924#ixzz2NffkeMAS