BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian stocks dove yesterday as inflationary and economic growth concerns returned to the fore amid persistently high commodity prices as well as the unresolved Russia-Ukraine dispute.
With growth concerns escalating, banking stocks were the leading losers while recent big gainers like plantation and oil & gas (O&G) stocks also retreated.
The broader market and lower liners endured the worst of the selling pressure, contributing to losers overwhelming gainers by a seven-to-one ratio.
There is no change to the immediate market outlook following the sell-off in global equities overnight that is also set to prolong the malaise among Malaysian stocks.
This could see wariness continuing to affect the direction of the economy amid fears that the increasing cost will eat into margins and delay corporate earnings recovery.
The unsettled market condition could also prompt further profit taking and selling on some of the stocks that have made significant headway since the start of the year as market players take a more defensive stance until stability is found.
As such, the downside risk remains with the immediate support of 1,570 points unlikely to hold.
Thereafter, the supports are located at 1,565 and 1,555 points respectively. The hurdles, meanwhile, are at 1,580 and 1,590 points respectively.
Malacca Securities Research
The FBM KLCI suffered huge losses in tandem with the slump in regional markets as tensions between Russia and Ukraine continued to shake the market.
We expect investors to remain cautious as sentiment is likely to stay negative on the broader market amid heightening concerns over inflationary pressure driven by the ongoing Russia-Ukraine conflict which will affect the input costs of all goods.
At the point of writing, crude oil price is trading above the US$120/barrel mark while crude palm oil (CPO) price hovered above RM6,500/metric tonne.
The FBM KLCI took a huge plunge to close below the 1,575 support level as the key index breached below the daily EMA20. Technical indicator turned mixed as the MACD Histogram trended lower while the RSI fell below the 50 level.
The support is now pegged around 1,550-1,565 while the resistance is located at 1,600-1,615. – March 8, 2022
