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 posted a mild rebound yesterday to halt its streak of losses with light bargain hunting on some of the recently beaten down index constituents.
Among the sectors that saw renewed interest were the banking and gaming stocks but glove makers continued to lose ground on their weaker prospects.
With the buying largely selective, market breadth stayed negative as many lower liners and broader market shares were still consolidating albeit with milder losses.
While the key index’s rebound was welcomed to break the downward spell, the broad market environment remains fragile with concerns over the lingering tax and interest waiver on bank’s earnings likely to keep sentiments cautious for longer.
At the same time, positive leads from local sources are still few and far between that could also keep most fresh buying interest at bay.
Meanwhile, overseas leads are also difficult to come by with concerns over Evergrande’s loan defaults keeping sentiments guarded thus leaving many market players on the sidelines as they adopt a wait-and-see stance.
Under the prevailing environment, we think the FBM KLCI is likely to drift further over the near term as it looks to find a base, hence the likelihood of trending within the 1,520 and 1,540 levels.
The other support is at 1,513 points while there is an interim resistance at around the 1,535 level.
Malacca Securities Research
The FBM KLCI bucked the overnight weakness on Wall Street, staging a rebound after seven straight declining sessions as investors indulged in bargain hunting activities, especially in the technology sector.
Mild extension of the rebound might take place in selected sectors as the Government has proposed three more destinations to be opened via domestic tourism bubble on the back of reducing active COVID-19 cases.
Meanwhile, both crude palm oil (CPO) and crude oil prices rose, while the Baltic Exchange Dry Index continued to charge higher to 4,410 after reaching its all-time high since November 2009.
The FBM KLCI rebounded, snapping the seven straight sessions of losses.
Technical indicators, however, remained negative as the MACD Histogram has extended a red bar while the RSI continued hovering below the 50 level. Resistance is pegged along 1,580-1,600, while the support is located around 1,515. – Sept 22, 2021
