The FBM KLCI posted further rebound in tandem with its regional peers amid fading geopolitical tension between Russia and Ukraine. However, failure of the Russia-Ukraine talks on cease-fire, coupled with the inflationary pressure could lead to more hawkish tone in the FOMC meeting next week. Hence, the retracement yesterday on Wall Street may put pressure on the local front and profit taking activities may emerge.

The FBM KLCI outperformed the mixed regional bourses despite the overnight negative performances on Wall Street, as bargain hunting activities took place. With the rebound in Wall Street overnight amid the easing tension between Ukraine and Russia, we reckon the gains on the local bourse could be extended, in most of the sectors that were being bashed down over the past month.

The sentiment on the local stock market remained bearish as another broad-based selloff pushed the FBM KLCI into the negative territory amid persisted worries over the ongoing tension between Russia and Ukraine. Although there might be mild bargain hunting activities in selected commodity sectors, we expect overall gains are likely to be short-lived, taking cue from the overnight Wall Street performance. Do note that investors will be monitoring the elevated commodity prices that may translate to significant inflation and input costs to various industries.

The FBM KLCI suffered huge losses in tandem with the slump in regional markets, as tensions between Russia and Ukraine continued to shake the market. We expect investors to remain cautious and sentiment is likely to stay negative on the broader market amid heightening concerns over inflationary pressure driven by the ongoing Russia-Ukraine conflict, which will affect the input costs of all goods.

The local bourse traded in the negative tone on Friday as the FBM KLCI reversed into losses as geopolitical tension between Russia and Ukraine persisted. We expect to see volatile trading movements on the local bourse at least for the near term given the on-going developments in the Russia and Ukraine region.

The FBM KLCI rallied amidst the mixed regional markets after taking cues from the (i) less aggressive rate hikes tone from the US Federal Reserve and (ii) Bank Negara Malaysia kept the OPR unchanged at 1.75%. Also, we believe the sharp gains noticed in the commodity-related sectors may persist over the near term as the steep rise in crude oil and crude palm oil prices were deemed advantageous to Malaysia and should translate to earnings in the upcoming quarters.

The FBM KLCI chalked up marginal gains led by the energy, plantation and metalrelated index components amid soaring commodity prices. We believe the key index is likely to hold its gains on the back of (i) the sharp rebound on Wall Street overnight following the US Federal Reserve supporting smaller rate hikes going forward, (ii) surging crude oil prices after a global agreement to release crude reserves failed to calm fears over supply disruptions, and (iii) likelihood for Bank Negara to hold the interest rate until end-June.

Despite a broad rebound in regional markets, the FBM KLCI retreated to close below the 1,600 psychological level as investors focus on the geopolitical developments between Russia-Ukraine after the earnings season. With the Wall Street remained in the risk-off mode overnight, we expect volatility to persist and profit taking activities may continue on the local front with the unsettled Russia-Ukraine incident. Nevertheless, the elevated commodity prices, coupled with the net buying of foreign funds should lend support to the local bourse.