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 managed to end on a slightly positive note yesterday in what was seen as a largely directionless trading environment that resulted in the key index lingering within a tight band for most of the day.
There was more interest on the lower liners and broader market shares as retail players continue to bargain hunt on some of the beaten down sector leaders.
This helped market breadth to remain positive albeit overall market interest was still moderate.
After the recent strong gains among the index heavyweights, there are fewer compelling buying opportunities for market players to follow.
As a result, conditions are turning increasingly indifferent with market players awaiting for further affirmation on the longevity of the key index’s recovery.
This has also seen the fresh buying interest on the heavyweights subsiding somewhat that could curb further near-term upsides.
Nevertheless, we still see the key index remaining close to the psychological 1,600 level as selling pressure has eased significantly due to gradual re-opening of the economy.
This may allow the FBM KLCI to stay range-bound for the time being as it also looks to build up a base near the 1,600 level.
Before the 1,600 resistance, there is an interim hurdle at 1,590 points while the 1,580 level is still the immediate support followed by the 1,570 level.
Malacca Securities Research
After fluctuating between modest gains and losses for most of the day, the FBM KLCI (+0.1%) inched up as gains in Press Metal Aluminium Holdings Bhd – powered by a surge in aluminium price – outweighed losses in selected banking and plantation heavyweights.
However, tracking the weaker performance on Wall Street overnight, the local bourse may turn sideways amid profit taking activities on the broader market.
Nevertheless, we expect the support from recent net foreign buying amid recovery hopes following more economic sectors being allowed to operate in Klang Valley in anticipation of moving into Phase 2 of the National Recovery Plan (NRP) to cushion the market’s downside risk.
Meanwhile, crude palm oil (CPO) price climbed while the crude oil price saw a pullback.
The FBM KLCI finished with marginal gains in choppy trade on Tuesday (Sept 7). Technical indicators remained mildly negative as the MACD Histogram has extended a red bar, while the RSI continued hovering below the 70 level.
Still, resistance is located at 1,600 while the support is pegged along 1,580. – Sept 8, 2021
