BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Bursa Malaysia stocks succumbed to heavy selling yesterday as the key index mirrored Wall Street and regional indices’ weak performances.
President Biden’s pullout of the presidential race also affected sentiments. As a result, profit taking was prevalent throughout the day with the key falling nearly 20 points before mild support emerged to allow the key index to close above the 1,620 level.
The selling was also widespread among lower liners resulting in total losers beating gainers on a 4-to-1 ratio.
Market conditions have turned weaker following yesterday’s steep falls that may see more market participants retreating to the sidelines until stability is found.
Despite the near-term uncertainties, the broad market conditions should remain mildly positive for now, supported by the country’s firmer economic undertone which could allow the key index to find support above the psychological 1,600 level.
At the same time, the pullback is also seen as healthy for the FBM KLCI’s recent gains to be absorbed before resuming its uptrend in due course.
Following the rebound on Wall Street overnight, there is a chance that the key index could mount a quick rebound from yesterday’s pullback as mild bargain hunting may emerge.
On the upside, the hurdles are at 1,626 and 1,632 points while the supports are at 1,620 and 1,615 points respectively.
Malacca Securities Research
The FBM KLCI traded lower in tandem with the FBM70 and FBM Small Cap indices.
However, we still anticipate that there is still a buy-on-dip opportunity amid the on-going data centre catalyst.
Meanwhile, the US stock markets snapped the earlier sell-offs to rebound across small and big cap stocks due to bargain hunting activities and expectations of interest rate cuts to come sooner this year.
Traders will also be watching earnings from General Motors, Coca-Cola, Alphabet and Tesla as well as key data such as existing home sales.
On the commodity markets, Brent crude fell for another session by trading below US$83/barrel while gold price dipped slightly below US$2,400/oz ahead of the US CPI (consumer price index) data (Friday). Elsewhere, CPO (crude palm oil) price managed to recover closer to RM4,000/metric tonne.
The FBM KLCI index retraced below the 1,625 level. The technical readings on the key index were mixed with the MACD histogram forming a rounding top formation and the RSI continues to trend above 50.
The resistance is envisaged around 1,640-1,645 while the support is set at 1,605-1,610. – July 23, 2024
