BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian equities continue to lose ground with the FBM KLCI slipping below the psychological 1,500 at the end of last week as sentiments turned increasingly cautious amid the unsettled political environment and unrelenting COVID-19 cases in the country.
As a result, selling became overwhelming with losers doubling the number of gainers. Expectedly, many lower liners and broader market shares also closed firmly in the red.
With the FBM KLCI tumbling below the 1,500 level, the key index’s base-building process has halted and the outlook is turning increasingly frail.
As a result, the benchmark index could retrace further amid weaker sentiments with uncertainties over the country’s political environment and unrelenting pandemic conditions continuing to sap market confidence.
Hopes for a quick rebound also look weak due to the increasingly cautious market undertone that could still see most market players remaining on the sidelines for now.
The sustained weakness could see the key index falling back to the 1,490 level with the next support pegged at 1,486 points. The 1,500 level is the immediate resistance, followed by the 1,511 level.
Malacca Securities Research
The FBM KLCI tumbled on Friday as investors grew wary of the pace of the economic following the spike in the daily COVID-19 confirmed cases as well as recent political developments.
Market sentiment dimmed, leading to the selling from foreign funds over the past five trading days. We expect the weakness to continue for this week without any fresh catalyst.
Meanwhile, crude palm oil (CPO) price dropped despite concerns over lowering output, while crude oil price stood above the US$76/barrel level.
The FBM KLCI finished the week on a negative note as the key index broken below the 1,500 support level.
Technical indicators turned negative as the MACD Histogram has turned lower, while the RSI hovered below the 50 level.
Downside risks may continue for the week while investors may monitor for the next support level at 1,480 if the key index could not cross above the 1,500 level. – Aug 2, 2021
