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 continues to march higher – this time closing at a fresh four-year high and near the 1,650 level as investors continue to be buoyed by the country’s positive 2Q 2024 GDP (gross domestic product) output.
On the key index, banking stocks provided the main lift to push it past the recent high of 1,637 points.
In the broader market, the gains were more modest amid a mixed market environment whereby total gainers just pipped losers. Traded volumes, however, climbed by some 21% to just shy of 4.0b units.
Market momentum is continuing to build-up, riding on the optimism over the country’s economic outlook that may extend the FBM KLCI’s ongoing run-up.
The key index’s gains were also largely in tune with the rebound in most key global equity indices amid the easing global recession risk that was briefly heighted earlier in the month.
Back home, there has been an encouraging of buying interest from foreign institutions to help lift the key index to its highest level in some than four years.
Although buying interest has yet to pick-up substantially, the key index is likely to continue its near-term run-up, supported by the on-going purple patch on equities.
On the upside, the targets are now at the 1,652-1,655 levels, followed by the 1,661 level. Meanwhile, the supports are at 1,637 points and at 1,631 points respectively.
Malacca Securities Research
The Bursa Exchange ended on a positive note, driven by banking heavyweights following Malaysia’s strong GDP data last Friday.
We anticipate that buying support may extend in anticipation of a stronger earnings season this month.
Meanwhile, US stock markets recorded their longest recovery streak in 2024 with the three major indices gaining between 0.58%-1.39%, driven by economic data indicating declining inflationary pressure coupled with improved retail sales and consumer sentiment.
Traders are now focused on the upcoming Jackson Hole meeting whereby the US Federal Reserve may offer clues on the timing of the next rate cut.
In the commodity markets, Brent crude continued to retrace amid on-going concerns over weak demand from China while gold remained above US$2,500/oz in anticipation of a potential rate cut. Meanwhile, CPO (crude palm oil) price trended sideways around RM3,700/metric tonne.
The FBM KLCI index ended vehemently higher towards the 1,648 level. The technical readings on the key index were positive with the MACD histogram forming another positive bar and the RSI continues to trend above 50.
The resistance is envisaged around 1,663-1,668 while the support is set at 1,628-1,633. – Aug 20, 2024
