BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The key index continues to dither and succumbed to another bout of selling as market confidence was shaken by fresh concerns over the country’s political state of affairs.
At the same time, the pandemic conditions also kept many market players guarded that further dented market sentiments.
The broader market was also insipid, leading to further profit taking that continued to dominate trades and causing market breadth to stay negative.
The key index’s near-term direction remains uncertain, affected by the fresh political intrigue as well as the lingering pandemic concerns.
This is likely to see it staying range-bound for longer with mild bargain hunting to cushion the bouts of selling.
With few market positivity, it is difficult for the key index to post a firmer bounce over the near term due to the guarded sentiments even as hopes has risen for the country to move into the next phases of recovery in view of the accelerated inoculation programme.
As such, the FBM KLCI is likely to trend within the 1,500 and 1,530 levels for now as it also looks to build up a base and to stay above the psychological 1,500 level.
The interim support remains at 1,510 while there is also a resistance at the 1,520 level.
Malacca Securities Research
The FBM KLCI edged lower amid uncertainties surrounding the recent political developments as well as the COVID-19 pandemic, contributing to investors staying on the sidelines.
This would result in heightened volatility in the market with traders turning more cautious over the near term in their stock selection.
On a side note, China’s move to raise export tariffs on some steel materials as well as removing rebates on cold-rolled products may exert pressure on the commodity prices as demand continues to rise over the past year.
The FBM KLCI erased its gains in the afternoon trading session, closing below the daily EMA9 level. Technical indicators remained negative as the MACD Histogram has turned into a red bar, while the RSI hovered below the 50 level.
We expect the key index to move between the support of 1,500 and resistance of 1,530-1,550 within the sideways drift. – July 30, 2021
