BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian equities were mostly range-bound yesterday after giving up most of its intra-day gains on quick profit taking activities. For the most part, however, the market’s condition was indifferent due to the lack of direction and relatively light participation even as it was an improvement over the previous session.
Nevertheless, market breadth was positive as retail players took the opportunity to trade on some of the laggards in the calmer market condition.
We see the mild bargain hunting activities continuing over the near term, buoyed by the positive overnight performances of key global equity indices that rode on the US president’s signing of an economic stimulus package.
This could allow the key index to build on the gains attained yesterday as we also think that rotational buying could pick-up following the recent market consolidation.
However, with market participation still on the thinner side, we also think that the gains may be modest with end-of-day profit taking actions possibly limiting the upsides.
As such, the 1,650 level continues to be the immediate hurdle, followed by the 1,660 level. The supports, on the other hand, are at 1,640 and 1,631 respectively.
Malacca Securities Research
With the US stock markets trended towards the all-time-high region as well as yearend window dressing activities, we expect the buying support to persist on the local stock exchange.
Meanwhile, traders may focus on the stronger-than-expected November exports numbers which could lift export related sectors. Also, Pharmaniaga Bhd’s vaccine distribution news is likely to spur interest within the logistic companies.
While we believe the rising commodities prices may support steel-related counters, the upside might be limited after several rounds of rally over the past few weeks.
The FBM KLCI has rebounded after hovering three days within the consolidation phase.
The Histogram indicator has rebounded (albeit in the negative region) while the RSI is hovering above the 50 level, suggesting that the positive momentum is still intact.
We expect the FBM KLCI to revisit resistance around 1,660-1,680, while the support is pegged around 1,620, followed by 1,600. – Dec 29, 2020
