BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The FBM KLCI maintained its upward streak that also saw it end the session at its highest level in a month as well as closing-in on the 1,490 level.
Foreign buyers continue to lift the key index higher with rotational buying into energy stocks that provide the lift to the key index.
At the same time, technology stocks also mounted a strong rebound to lead the broader market shares higher. As a result, gainers beat losers on a ration of more than a 2-to-1 ratio with traded volumes also picking up.
There remains short-term positivity on Bursa Malaysia as it continues to ride on the gains in key overseas equity market that are reacting to a spate of better-than-expected corporate results to offset confirmation that the US economy is in a technical recession.
Meanwhile, odds of an impending Malaysian general election have risen after the Parliament approved the anti-hopping act and this could spur more interest in Malaysian equities albeit market conditions are approaching overbought after the FBM KLCI’s 80 points gain in the past two weeks.
For now, the key index may attempt to reach the psychological 1,500 level to end the week. Prior to that, there is an interim hurdle at around the 1,493-1,495 levels. On the downside, there is support at the 1,480 level followed by the 1,472 level.
Malacca Securities Research
The FBM KLCI rallied in a constructive Thursday session in tandem with the regional peers taking cue from the strong gains on Wall Street.
We believe the narrative that the US Fed will slow down the pace of interest rate hikes will continue to send positive signal to the regional and local bourses despite contraction of the US GDP (gross domestic trade).
Meanwhile, Indonesia’s decision to lift its restrictions on the entry of its workforce into Malaysia starting Aug 1 should benefit the manufacturing and plantation sectors in Malaysia.
Commodities-wise, Brent crude oil price rose above the US$107/barrel mark while crude palm oil (CPO) price was traded above the RM4,000/metric tonne level. Gold price has also seen some uptick in movement.
The FBM KLCI rose above its resistance at 1,480 and the daily EMA60 level after closing at its session high. Technical indicators remained positive as the MACD Histogram extended a positive bar while the RSI hovered above the 50 level.
The next resistance is set along 1,500-1,530 while the support is located around 1,450. – July 29, 2022
