BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian equities regained their footing yesterday with selective buying helping to lift most share prices in a market where participation was expectedly lower due to the ongoing year-end holiday season.
Part of the recovery was helped by the resurgent of heavyweight glove makers’ share prices as they gained ground in light bargain hunting.
We see sustained gains heading into the New Year break in what is expected to be again lighter-than-usual trading volumes due to the holiday season and dearth of new leads.
There will still be bouts of mild bargain hunting activities to help keep the key index afloat and this could also possibly allow it to end the year near the psychological 1,650 level.
Despite the overall positivity, however, plantation stocks could endure some weakness after Sime Darby’s palm oil was banned in the US for allegation of using forced labour.
Nevertheless, we think the fallout is likely to be contained and stocks on Bursa Malaysia should still chalk-up mild gains.
Apart from the 1,650 resistance, the other is at 1,660, while the supports are at 1,640 and 1,631 respectively.
Malacca Securities Research
With the US stock markets closing marginally higher, coupled with the year-end window dressing activities, we expect trading interest on the local exchange will be positively skewed for the final day of 2020.
Meanwhile, we believe Brent oil price may trade firmer on the back of greater-than-expected oil inventory draw of 6.1 million barrels for the week ended Dec 25.
Besides, we opine that market players may focus on recovery themed stocks given more countries allow vaccine for emergency use.
The FBM KLCI has revisited the 1,640 range after a decent sideways consolidation move.
The Histogram indicator continues to recover from the negative territory while the RSI is ticking higher above 50, suggesting that the positive momentum has been increasing over the past few days.
The FBM KLCI may extend its rebound move with the next resistance located around 1,660-1,680. Support is located around 1,620. – Dec 31, 2020
