BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Local institutional support has helped to shore up the key index to a positive close at the end of last week.
In the process, the FBM KLCI also climbed back above the 200-day moving average line albeit just marginally to leave a mildly positive outlook.
Overall trades, however, were relatively subdued with volumes slipping below 3 billion shares even as there was firmer interest on the lower liner stocks that also enabled market breadth to turn positive.
Although the key index managed to recoup much of the previous week’s losses, market conditions are still mostly indifferent.
As it is, last Friday’s gains could well have been window dressing activities as market sentiments remain largely insipid, devoid of significant leads and buying interest are likely to remain thin, particularly from foreign funds heading into the final weeks of the year.
Market players could now be eyeing the upcoming US Federal Reserve meeting for a widely expected interest rate cut to preserve the key index’s mildly positive outlook into the start of 2025.
Therefore, the mild window dressing activities may continue as the key index looks to end the year on firmer footing despite the continuing choppiness.
On the upside, the key index could target the 1,612-1,615 levels before heading towards the 1,620 level. The supports, meanwhile, are at 1,605 and 1,600 levels respectively.
Malacca Securities Research
The FBM KLCI closed higher after a five-day losing streak with the healthcare sector rebounding amid recent news on disease outbreaks in China and Congo.
We believe the US markets will continue to trade sideways ahead of the Federal Open Market Committee (FOMC) meeting where the current market consensus anticipates a 25 basis points (bps) rate cut.
Besides that, traders will closely monitor economic data like (i) Flash Manufacturing & Services PMI; (ii) Retail & Core Retail Sales; (iii) US GDP (gross domestic product); (iv) unemployment claims; (v) Core PCE Price Index; and (vi) the Bank of Japan’s (BOJ) monetary policy conference.
In the commodities market, Brent crude rose near US$74/barrel despite rising production and larger inventories in2025. Gold prices retreated below the US$2,700/oz mark while CPO (crude palm oil) prices continued to trade below the RM5,000/metric tonne level.
The FBM KLCI rebounded and closed higher, approaching the 1,608 level. Meanwhile, the MACD Histogram has performed a rounding top formation and the RSI hooked above 50, suggesting that the momentum is stronger at this juncture.
Resistance is envisaged around 1,623-1,628 while support is set at 1,588-1,593. – Dec 16, 2024
