BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
There were more upsides on the FBM KLCI as it rose to its highest level in three months on the back of sustained buying from foreign institutions, casting aside concerns over the rising domestic COVID-19 cases.
Much of the upsides were shored up by gains in plantation and banking stocks while the lower liners and broader market shares were also buoyed by the more positive market undertone.
As a result, market breadth stayed positive with traded volumes also tipping above the 3 billion shares mark.
The strong buying interest has certainly helped Malaysian equities to make a firm revival from the taper tantrum and allowing the key index to regain most of its losses induced by the sell-off in January.
Heading into the weekend, however, profit taking activities may emerge as market players could opt to lock-in some profit from the week’s strong performance.
The expected profit taking follows the unabated rise in US inflation that led to steep falls in major global equity indices overnight on renewed concerns that the Federal Reserve would be more aggressive in its tapering process.
The profit taking could also cast aside the expected revival of the country’s economic performance in 4Q 2021 where the GDP (gross domestic product) data will be released by Bank Negara Malaysia (BNM) today.
With sentiments spooked again, the key index may retrace back to the support at 1,564 points which is followed by the 1,560 level. The resistances, meanwhile, are at 1,572 and 1,580 points respectively.
Malacca Securities Research
After delivering two days of sturdy performances, investors’ attention has now shifted towards the upcoming release of the 4Q 2021 GDP data later today in order to assess the pace of economic recovery.
Amid the renewed volatility on Wall Street overnight, we reckon that profit taking activities may take shape amid the mounting concerns over the pace of interest rate hikes for the US in 2022.
The lower liners are also turning choppier after enjoying a decent run since end-January 2022 as signs of profit taking activities are emerging.
The FBM KLCI formed another bullish candle as the key index hit the immediate resistance of 1,570. Technical indicators stayed positive as the MACD remained above the zero level, while the RSI remained above 50.
The next resistances are located at the 1,580-1,600 while support is set around 1,525 followed by 1,500. – Feb 11, 2022
