BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The FBM KLCI broke the 1,610 hurdle yesterday as index-linked stocks continued to make headway with banking, oil & gas (O&G) and plantation stocks providing market lift amid the higher commodity prices.
The upsides were also in tandem with the gains in regional indices that were buoyed by hopes that the Federal Reserve’s impending rate hike will be mild.
Nevertheless, many of the lower liners were in the red, resulting in market breadth remaining negative for the day.
Conditions on Bursa Malaysia remains largely positive on the heighten commodity prices that could further shore up the earnings prospects of planters and O&G-related entities for the year.
This could help to cast aside the renewed inflationary concerns and keep the key index elevated for longer.
However, volatility could emerge at the end of the week with profit taking setting in after yesterday’s hefty gains, particularly on some of recent big movers in the plantation sector following palm oil prices retreat overnight.
This could tip the key index to a lower close by possibly returning to the 1,610 level. Below that, the other support is at the psychological 1,600 level. Meanwhile, the resistances are at 1,620 and 1,628 points respectively.
Malacca Securities Research
The FBM KLCI rallied amid the mixed regional markets after taking cues from the (i) less aggressive rate hikes tone from the US Federal Reserve and (ii) Bank Negara Malaysia (BNM) keeping the OPR unchanged at 1.75%.
Also, we believe the sharp gains noticed in commodity-related sectors may persist over the near term as the steep rise in crude oil and crude palm oil prices were deemed advantageous to Malaysia and should translate to earnings spike in the upcoming quarters.
Nevertheless, investors may focus on the developments of the geopolitical tensions between Russia and Ukraine.
The FBM KLCI finished at its intraday high above the 1,600 psychological level. Technical indicators remained positive as the MACD Histogram extended a positive bar while the RSI trended higher above the 50 level.
Should the key index hold above the previous resistance at 1,615, the next resistance is pegged around 1,635-1,645 while the support is set at 1,600. – March 4, 2022
