BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
After a relatively mixed session, the key index regained the 1,500-mark following last minute buying on selective index linked stocks that also allowed it to break its downward spell.
Leading the key index higher was selective banking and plantation stocks, while many of the lower liners and broader market shares also made up ground in light bargain hunting activities.
However, losing stocks were still ahead of gainers for the day.
Despite yesterday’s rebound, we still think the underlying market environment is one of cautiousness that is heightened by the country’s new political developments where the Government has reportedly lost its majority.
The political imbroglio will continue to leave market conditions guarded for longer and as such, we think there will be little follow-through buying due to the heightened uncertainties.
This is likely to leave the key index to drift further with the 1,500-point level unlikely to hold for long. Below that, the supports are at 1,493 and 1,490 points while the resistances are at 1,508 and 1,516 points respectively.
Malacca Securities Research
The FBM KLCI snapped a three-day losing streak to close in the positive territory, bucking the regional downtrend.
However, sentiment may remain cautious amid heightened uncertainties surrounding the recent political developments.
Meanwhile, the move of three more states into Phase Three of the National Recovery Plan starting from today, coupled with the earning season may lift market sentiment.
Commodities-wise, crude oil price declined amid the spread of the Delta virus variant which may pose a risk to oil demand.
The FBM KLCI climbed back above the 1,500 level after bargain hunting activities emerged in the final trading hour.
Technical indicators turned slightly positive as the MACD Histogram has turned green, while the RSI rebounded above 30 level.
However, investors may continue to trade in a cautious mode with support set at 1,480, while the resistance is located at 1,520 if the key index stays above 1,500. – Aug 4, 2021
