BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Index-linked stocks succumbed to a new bout of profit taking at the start of the week to leave it further away from the psychological 1,600 level.
Despite its weakness, the broader market and lower liners were mostly higher as rotational interest picked up, including a revival of technology-related stocks on gains in global technology stocks.
Nevertheless, traded volumes were little changed from last Friday as fresh leads were still far and in-between.
While we expect the key index to linger close to the 1,600 level, the efforts proved futile as profit taking actions were quick to materialise, leaving the FBM KLCI to drift lower after their recent big moves.
Although we see the market’s undertone improving with the gradual re-opening of the country’s economic sectors, there is still caution over the key index’s near-term outlook due to the lingering pandemic conditions that could still delay a meaningful recovery.
Therefore, the market’s volatility may also still endure for longer due to the continuing near-term uncertainties, albeit we think the downside risk has largely dissipated as the worst of the pandemic conditions should have passed.
Meanwhile, the key index should be attempting to find near term support at the 1,580 level but if it gives way, the next support is at 1,570 points. On the flipside, the resistances are at 1,590 and the 1,600 level respectively.
Malacca Securities Research
Bucking regional uptrend move, the FBM KLCI dipped into the negative territory in mid-morning as selected plantation, banking and PETRONAS-linked stocks went through some profit-taking activities.
We believe the ongoing discussion on SOP (standard operating procedures) relaxation in preparation for the COVID-19 endemic phase, coupled with the declining COVID-19 daily infections may continue to drive the recovery theme play across the board.
Commodities wise, crude palm oil (CPO) price climbed, while aluminium price also increased on the back of concerns over raw material supply amid a coup in Guinea, the major supplier of bauxite.
The FBM KLCI reversed, erasing yesterday’s gains to close below the SMA200 level. Technical indicators remained mildly negative as the MACD Histogram has extended a red bar, while the RSI stayed below the 70 level.
Resistance is located at 1,600 while the support is envisaged along 1,580. – Sept 7, 2021
