BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Key index stocks continue to lose ground at the start of the week as there was still a lack of fresh buying interest.
As a result, stocks were left to drift lower with profit taking continuing amid the lack of leads.
It was also a similar story among the lower liners and broader market shares as they, too, were on a consolidation mode again with technology stocks being the biggest losers.
Market breadth was on the negative side while traded volumes also thinned, falling some 16% from last Friday.
With few impetuses, the key index is likely to stay indifferent as market players await for a new direction to emerge before making fresh moves.
As it is, the market is at the crossroads after making a decent recovery from its oversold conditions in late 2Q 2022 to climb back to the 1,500 level which is proving to be a formidable level to clear for the time being.
This could instead see the key index undergo a base building phase around the 1,500 level and to consolidate its gains from the recent rebound.
If so, the key index could trend within the 1,490 and 1,505 levels for the time being. Beyond these levels, the other support and resistance levels are at 1,480 and 1,510 points respectively.
Malacca Securities Research
The FBM KLCI finished lower on the back of cautious undertone ahead of the US inflation data that will be released on Aug 10.
Given the market has rallied over the past two months, investors are likely to stay on the sidelines to monitor closely the CPI data in order to decide on the market direction as well as the Federal Open Market Committee’s (FOMC) interest rate decision moving forward.
Also, the development of China’s aggressive drills near Taiwan may pose downside risk to the stock markets.
Nevertheless, investors may start to position themselves ahead of the earnings season.
Commodities-wise, Brent crude rebounded mildly above the US$96/barrel mark while crude palm oil (CPO) price hovered above RM4,000/metric tonne.
The FBM KLCI fell for the second session in a row to close marginally below the key 1,500 level. Technical indicators have turned weaker with the MACD Histogram heading closer to zero while the RSI is hooking downwards.
The support is set at 1,460-1,480 while resistance is pegged around 1,530-1,550. – Aug 9, 2022
