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 remains lower for the fourth consecutive session to end at the 1,530-support level as it continues to move within a tight range.
As it is, concerns over the unabating COVID-19 pandemic coupled with few positive leads continued to keep the market on the downtrend with sentiments staying wary.
The lower liners and broader market shares also retreated following their recent uptick with profit taking emerging. As a result, market breadth turned negative with shrinking volumes.
We see market conditions becoming increasingly uncertain following Umno’s withdrawal from the Government that would deepen the political imbroglio.
With the heightened uncertainties, we think the selling could also hastened and a flight to safety in on the cards in what may be seen as knee-jerk reaction to the increasingly fluid political environment.
The lingering concerns over the country’s pandemic condition could also weigh on sentiments and leave the downside pressure intact for the time being.
Consequently, we expect the 1,530 support to give way on the back of the renewed selling with the support now pegged at the 1,520 level. If this level gives way as well, the following support is at the 1,500 level.
On the other hand, the resistances are at 1,536 and 1,548 points respectively.
Malacca Securities Research
The FBM KLCI sank for another session despite final hour bargain hunting activities as investors mulled the high number of COVID-19 confirmed cases while awaiting Bank Negara Malaysia’s interest rate decision today.
Meanwhile, there are several developments in the political scene which may contribute to volatility in the markets.
Also, we expect the ongoing lockdown in several localities coupled with the COVID-19 status in Malaysia to continue weighing on the local bourse.
Commodities-wise, both crude palm oil (CPO) and oil prices have extended their pullback.
The FBM KLCI closed mildly lower, forming a hammer candle after erasing most of its intraday losses. Technical indicators remained mixed as the MACD Histogram has extended a green bar, while the RSI hovered below the 50 level.
Investors are likely to stay sidelines over the near term. Resistance is set at 1,560-1,580 for the key index, while the support level is envisaged to be around 1,500-1,520. – July 8, 2021
