Share prices ended lower yesterday on an extended technical sell-off of most counters, especially financial and small-cap stocks, dealers said.
At the close, the FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI) stood at 1,566.51 points, down 3.53 points or 0.22 per cent after opening 1.19 points lower at 1,568.85. The key index moved between 1,561.87 and 1,568.88 during the day.
Dealers said finance counters were hit by consistent profit-taking ahead of the Monetary Policy Committee meeting of Bank Negara Malaysia next Thursday.
MIDF Research said the potential for an Overnight Policy Rate (OPR) hike next week might be the catalyst for the market to break the 1,600-point level.
The research house said banking stocks were expected to rally if the central bank raises the benchmark rate by 25 basis points (bps) next week.
"We continue to hold our view that Bank Negara will raise the OPR by between 50 bps and 75 bps in 2011, with a 40 per cent possibility of a 25 bps hike in the first-half and the balance in the second half of 2011," it said.
Another research house said there was a healthy consolidation of the FBM KLCI following a 45-point gain in the first week of the year.
OSK Research said although the market shed 4.45 points on Tuesday, market action was still confined within the recent consolidation range. It said the FBM KLCI was not only trending sideways in a constructive manner for more than a week but the index remained within the uptrend channel.
"The index's current constructive posture is a signal that there is a great possibility that it would able to create a new record high soon," OSK said.
Read more: KL bourse easier on technical correction http://www.btimes.com.my/Current_News/BTIMES/articles/bursareport20/Article/#ixzz1BXz2pGD6
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