BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian equities managed to end the day off their lows following the Prime Minister and his cabinet’s resignation, buoyed by some end-of-day buying support to keep the key index above the psychological 1,500 level.
Nevertheless, losers continue to overwhelm as selling intensified among the lower liners with the day’s turnover rising above the 5-billion shares mark with many market players trimming their positions amid mounting political uncertainties.
We continue to think that the near-term market outlook remains weighed down by political uncertainties as there are no clear favourites to replace the outgoing Prime Minister.
Also, with no one party commanding a majority in Parliament, the political limbo is set to prolong and this is expected to dampen market outlook for the time being.
As a result, most market players are expected to remain on the sidelines while awaiting a clearer outlook to appear before re-committing to Malaysian equities.
The lack of direction could also further leave the market to drift with the downside risk also likely to extend due to fewer buying support.
Under the prevailing environment, the 1,500 level is still under threat with the 1,490 level the ensuing support. The hurdles, meanwhile, remain at 1,510 and 1,520 points respectively.
Malacca Securities Research
The FBM KLCI edged lower despite bargain hunting activities in the latter part of the trading session as upside has been capped by concerns over lingering political uncertainty after Prime Minister Tan Sri Muhyiddin Yassin’s resignation.
While investors’ sentiment is expected to remain jittery given ongoing battle with the COVID-19 pandemic, focus will be on the upcoming corporate earnings season.
Commodities-wise, crude palm oil (CPO) continued to hover around the all-time high region, while crude oil price fell below the US$70 level.
The FBM KLCI slipped to close just above the daily EMA9 level as well as the psychological 1,500 level.
Technical indicators remained mixed as the MACD Histogram has extended a green bar while the RSI continued hovering below the 50 level.
Market may continue to trade in cautious mode with next resistance envisaged at 1,520 while the support is set around 1,480. – Aug 17, 2021
