BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Index heavyweights regained some traction yesterday in line with the gains in regional indices with glove maker stocks leading the FBM KLCI gainers list as they continue to rebound from their recent sell-down.
The gains also allowed the key index to end the day at the psychological 1,580 level but conditions elsewhere stayed muted with losing stocks still dominating gainers.
Market interest also stayed relatively insipid, unchanged from the previous day.
The key index is attempting to break its downward streak that has already left it oversold and despite the lack of participation, we see the efforts extending over the near term on mild bargain hunting actions, particularly on some of the beaten down glove makers.
Although broad optimism is still lacking due to the extended lockdown that could further pin the economic recovery back, we still think the market could build on yesterday’s bounce as the key index could be attempting to find some stability and to build up a base at around the 1,580-1,600 points level.
The gains in key overseas indices could also provide some near-term impetus for the key index to tip higher.
In the interim, there is a hurdle at the 1,590 level, while the supports are pegged at 1,575 and 1,566 points respectively.
Malacca Securities Research
While the broader market may price in the extension of movement control order (MCO2.0) (except for Sarawak), we believe market players may turn their focus to Sarawak-related stocks following the uplift of MCO2.0 as more economic sectors are allowed to operate moving forward.
Also, tracking the positive sentiment on Wall Street overnight that should lift the overall market sentiment on the local front.
The FBM KLCI closed in the green and supported above EMA120 level, accompanied by improved trading volume. Technical indicators, however, remained mixed as the MACD Histogram has turned into a green bar, while the RSI has crossed back above 30 but still hovering below 50.
The FBM KLCI’s support will be located around 1,550-1,560, while the resistance is pegged along 1,600-1,610. – Feb 3, 2021
