BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
After a slow start to the day, the FBM KLCI regained traction and posted decent gains to surge past 1,460 points yesterday – its highest level since March.
Banking stocks were again the main contributors to the sustained gains which was further augmented by rotational buying into telco stocks.
In the broader market, technology stocks were the main movers but market breadth was relatively choppy with gainers just tipping ahead of losing stocks for the day. Traded volumes were little changed from a day ago.
The key index is regaining strength after its brief pullback last week and has defied the choppy conditions among global equities to sustain its upsides since the start of 2H 2023, mostly on the back of the continuing buying interest from foreign funds.
By and large, the FBM KLCI’s recovery has exceeded expectations and allowed it to regain most of the steep losses in 1H 2023.
The still firm market undertone could still permit the key index constituents to sustain their upsides ahead of the upcoming state elections and to decouple from the vagaries of global equities.
As such, the upsides look to continue, supported by the still positive technical indicators that also suggest more near-term upsides.
With the 1,460 level-turned support cleared, the next hurdles are at 1,468 points and 1,473 points respectively while the other support is at the psychological 1,450 level.
Malacca Securities Research
Expectedly, the key index remained on course over its upbeat tone yesterday as gains were evident amongst most of the index heavyweights.
We expect buying momentum to remain stable, supported by the return of net buying position from the foreign funds.
The lower liners, however, may tread cautiously as we enter the quarterly reporting season.
Meanwhile, investors will be keeping a close watch on Malaysia’s unemployment rate as well as the US inflation rate today; the latter may provide additional clues over the US Federal Reserve interest rate direction moving forward.
Commodities-wise, Brent crude advanced above US$87/barrel while crude palm oil (CPO) prices hovered above RM3,700/metric tonne.
The FBM KLCI formed another bullish candle as the key index closed at its intraday high yesterday. Technical indicators, however, remained mixed as the MACD Histogram extended another negative bar while the RSI hooked into the overbought territory.
The immediate resistances are located along 1,480-1,500 while the support is pegged around 1,420-1,440. – Aug 10, 2023
