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 pulled back yesterday after an extended run-up that has left it on an overbought streak.
In the process, the key index slipped back below the 1,600 points level with recent big movers like banking and glove maker stocks ending the day lower on profit taking activities.
The broader market, however, remained mixed as losing stocks were still ahead of gaining stocks while total traded volumes stayed largely moderate despite showing a pick-up in activities.
We see further near-term consolidation after the key index’s extended run-up continues to leave it at toppish levels.
At the same time, the valuation of many stocks recovered in the recent run-up after their valuations were tripped lower by the incessant selling in the first half of the year.
As it is, there are still few noteworthy leads to sustain the run-up as the renewed buying was mainly the result of Malaysian equities playing catch-up the global equity markets’ year-to-date ascend.
Under the prevailing environment, we think that the downside bias is poised to continue over the near term which could send the key index back to the 1,580-support level. Below that, the other support is at 1,570 while the resistances are at 1,593 and the 1,600 points respectively.
Malacca Securities Research
The FBM KLCI retreated yesterday, snapping a seven-day winning streak and backing away from the 1,600 psychological level as profit taking activities kicked in.
However, we believe the local stocks could continue to eke out gains after taking a breather as investors’ confidence could be boosted by the pre-budget statement issued by the Finance Ministry which is believed to spur economic recovery.
Meanwhile, OPEC+ is expected to stick to the existing gradual output hike despite revising up the 2022 demand outlook which may boost the oil price in the long run.
The FBM KLCI snapped seven-day winning streak and closed below the 1,600 psychological level. Technical indicators turned mildly negative as the MACD Histogram has turned into a red bar, while the RSI has hooked lower in the overbought region.
Resistance is pegged around 1,600 while support is located along 1,580. – Sept 2, 2021
