What to expect on Bursa Malaysia Monday

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 still ended the week on a firm note, picking up nearly 3.0 points to buck the generally tepid regional market conditions that were mostly on the downtrend.

As it is, market players cheered the country’s advance GDP (gross domestic product) announcement that indicated a 3.9% year-on-year (yoy) growth which was an improvement over the preceding quarter.

The lower liners, however, were mostly lower with market breadth being decidedly negative as losers beat gainers on a 3-to-1 ratio on total volumes of 4.7 billion shares.

Although the key index managed to post gains, the near-term outlook is still unsettled due to the insipid conditions among global and regional equity indices.

Much of Friday’s gains were on rotational buying which may become choppier as it heads towards the 1,550 level amid the continuing disposals by foreign funds.

The advance GDP announcement – while still showing improvements – were still lower than consensus estimate for a 4.1% yoy growth.

As the key index approaches the 1,550 level, there could be more volatility on selling into strength activities that could slow its ascend and the level could prove to be a significant hurdle to breach again.

Above the level, the resistances are at 1,553-1,557 points, followed by the 1,560 level. The supports, on the other hand, are at 1,545 and 1,540 points respectively.

Malacca Securities Research

The FBM KLCI extended its rebound for the third session. Meanwhile, the US Tech sector was hit the hardest given the market could be pricing in further delay on the interest rate cut by the US Federal Reserve after the stronger than expected economic data and elevated inflationary pressure.

Generally, the higher-for-longer environment could pose downside risk towards the stock markets, capping the upside momentum on the local front.

Nevertheless, traders will be focusing on several key events with the US GDP due on Friday, and the release of corporate earnings by Tesla, Meta, Microsoft and Alphabet this week.

On the commodity markets, Brent crude retraced from its intraday high of US$90.70/barrel to close around US$87/barrel while gold price traded along US$2,400/oz. However, the FCPO (crude palm oil futures) traded below the RM4,000/metric tonne level.

The FBM KLCI index ended higher for the third consecutive day. The technical readings on the key index were mixed with the MACD Histogram extending another negative bar while the RSI climbed above 50.

The resistance is envisaged around 1,560-1,565 while the support is set at 1,525-1,530. – April 22, 2024

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