BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Malacca Securities Research
The FBM KLCI closed mildly lower (yesterday) as sentiment turned downbeat as investors booked in gains from the previous session’s rally.
While the local bourse is demonstrating some mild weakness, we reckon that the general recovery trend is still intact as the attention remains focus on the pace of economic recovery.
The positive development over the COVID-19 vaccine will also continue to aid the recovery progress. Meanwhile, the lower liners are expected to charge higher, driven by the ample liquidity with the equities market remain in favour.
The energy sector is poised for a recovery after crude oil prices snapped a three-day pullback amid the unexpected decline in US inventory ahead of the OPEC meeting today. Meanwhile, the technology sector may garner further trading interests following the strong 3Q CY2020 semiconductor equipment billings.
With the recovery trend remains largely in place, we think that further upsides are still on the cards towards the next resistance at 1,615, followed by 1,640. Meanwhile, the supports are at 1,580, followed by 1,560.
Inter-Pacific Research
Key index stocks retreated yesterday on mild profit taking following the previous session’s strong comeback.
For the most part, market conditions were on the positive side with much of the action on the lower liners and broader market entities amid retail buyers remaining net buyers.
Glove makers, however, were among the biggest loser as Top Glove is still grappling with the COVID-19 breakout at its plants, while oil and gas stocks also retreated as prices pulled back from their recent gains.
The market’s indifference seems to have prevail again as there appears to be few impetuses to lift the key index significantly beyond the 1,600 level – a level where base building looks to be in progress.
This follows the FBM KLCI’s swift rebound from its steep pushback a few sessions ago and further gains appears difficult to come by due to the already toppish valuations which has largely priced-in the potential earnings recovery for 2021, in our view.
Hence, we think the that key index may look to linger around the 1,600 points level for now after it has gained some 10% in November that is seen as more-than-decent to reflect the impending availability of COVID-19 vaccines.
Within its range-bound trend, the FBM KLCI’s supports are at the 1,590-1,596 levels, while the resistances are at the 1,610-1,620 levels respectively. – Dec 3, 2020
