BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
There was quick profit taking on Friday that saw the key index giving back some of its previous day’s gains.
Much of the pull-back was due to profit taking on plantation and telco stocks. However, technology stocks continue to make significant headway and emerging as the day’s biggest movers with market breadth remaining positive.
Many of the lower liners and broader market shares also ended the week on an upbeat note as they continue to see bouts of bargain hunting.
We still think that the market undertone is one of indifference in the absence of significantly positive market leads to impart positivity to market players over the near-to-medium term.
As a result, we see the mostly sideway trend continuing, supported by mild bargain hunting that would counter the pockets of selling and profit taking actions.
There are still uncertainties over the country’s economic outlook as there are few signs as to when the pandemic conditions will ease with more COVID-19 cases being reported.
At the same time, market players will also be keeping an eye on the resumption of Parliament today as more political uncertainties could emerge.
Under the prevailing environment, we think the key index is likely to hover within the 1,510 and 1,530 levels for the time being. The interim support and resistance are at the 1,520 and 1,525 levels respectively.
Malacca Securities Research
The FBM KLCI finished the week on a negative note in line with the mixed regional performances due to resurgence of COVID-19 infections globally.
While the local bourse has been trading in upward bias consolidation mode last week, investors may remain cautious with the five-day special Parliament sitting this week.
Nevertheless, we expect investors to shift their attention from the daily COVID-19 infection rates to the current ongoing vaccination rate which is above 400,000 doses per day; this should provide some booster in stabilising the market sentiment with focus on recovery theme stocks.
Meanwhile, both the crude palm oil (CPO) and Brent oil prices surged last week.
The FBM KLCI staged a pullback to close just above the daily EMA9. Technical indicators remained mixed as the MACD Histogram has extended a green bar, while the RSI was still hovering below the 50 level.
While the key index is struggling to climb towards its resistance at 1,530-1,550, the FBM KLCI may trade sideways. The support level is envisaged around 1,500. – July 26, 2021
