BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian equities lost ground again yesterday, failing to build on the gains attained a day earlier with quick profit taking actions holding back the market.
Cushioning the pull-back, however, was glove-maker stocks after Top Glove Corp Bhd reported another strong set of earnings.
Elsewhere, the lower liners and broader market shares also retreated with technology shares the big losers on the dearth of positive leads.
Expectedly, both traded volumes and market breadth were on the weaker side.
The anticipated follow through buying failed to materialise to leave the market on a drifting mode again, a condition that we see continuing over the near term as market players are still uncertain of the near-term direction.
In addition, the wariness remains on the state of the country’s economy that could further leave more market players on the sidelines.
Meanwhile, overseas leads are also few and in-between as market players await for the US CPI (consumer price index) data that could cloud the prospects of cheap funding over the foreseeable future as inflation creeps up.
As such, we expect the key index to continue drifting with a downside bias to persist for the time being.
On the downside, the immediate support is at 1,580 points, followed by the 1,575 level. The resistance, meanwhile, are at 1,590 and the 1,600 levels respectively.
Malacca Securities Research
The FBM KLCI reversed its gains from the previous session as the key index languished in the negative territory on profit taking, mirroring the regional declines.
However, we believe investors’ sentiment may turn mildly positive following the Government’s announcement to commence the dispensing of vaccines to critical economic sectors under phase four of the National Covid-19 Immunisation Programme, targeting to increase the vaccination rate.
Commodities-wise, crude palm oil (CPO) price extended its losses, while crude oil price remained flat around US$72.
The FBM KLCI failed to extend its rebound as the key index retreated to close below the EMA20 level. Technical indicators turned negative as the MACD Histogram turned red, while the RSI hovered marginally below the 50 level.
We expect the key index to trade sideways in upward bias tone with resistance located around 1,600-1,620, while the support is set at 1,555-1,565. – June 10, 2021
