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 mounted a rebound to start the week, buoyed by Friday’s Wall Street gains on optimism that the US will cut interest rates soon.
However, the upsides were relatively modest after the recent strong recovery and fewer domestic leads to encourage more participation.
As a result, the broad market environment was relatively mixed with traded volumes slipping by some 20% to below 3 billion shares for the day.
With the key index approaching the psychological 1,650 level, conditions are becoming increasingly toppish with market conditions also becoming directionless.
Consequently, FBM KLCI is likely to stay range-bound as market players await for more impetuses before deciding on their next course of action.
The slew of corporate results to be released over the next few days could provide some near-term leads but with fewer compelling buying opportunities, the market will be on the look-out for stronger impetuses – both domestic and overseas – for their stock picking actions.
As such, the key index could linger within a tight range between the 1,635 and 1,645 levels for the time being. The other support and resistance levels are at 1,631 points and the psychological 1,650 points respectively.
Malacca Securities Research
Trading activity on the local front was positive with most sub-indices closing higher.
Despite the US Federal Reserve’s dovish stance at the recent Jackson Hole Symposium, sentiment on Wall Street was mixed with profit-taking observed in the technology sector.
Investors will be closely monitoring key economic data this week, including (i) consumer confidence (today); (ii) preliminary US GDP (Thursday); (iii) unemployment claims (Thursday); and (iv) core PCE (Personal Consumption Expenditures Price Index) data (Friday).
In the commodity market, Brent crude rebounded further, rising above US$81/barrel amid increasing geopolitical tensions and expectations of lower interest rates boosting economic activity.
Gold prices remained stable above US$2,500/oz while CPO (crude palm oil) prices surged past RM3,900/metric tonne as Indonesia aims to implement 50% palm-based biodiesel blending by 2025.
The FBM KLCI index ended higher towards the 1,638 level. However, the technical readings on the key index were positive with the MACD histogram forming another positive bar and the RSI trended above 50.
The resistance is envisaged around 1,653-1,658 while the support is set at 1,618-1,623. – Aug 27, 20234
