BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Market sentiments turned warier following the US Federal Reserve’s hint of hastening its tapering process, sending most global stocks, including Malaysian equities lower.
The meek conditions were widespread with profit taking from last week’s window dressing escalated as a result.
Market breadth also turned negative with losers almost twice the number of gainers as most of lower liners and broader market shares retreated. Traded volumes also slipped back below the 3 billion level.
The market’s mildly positive undertone has reversed after the past few sessions’ pullback that has left sentiments on the cautious side once more.
This has resulted in market confidence taking another hit just as the buying interest was picking up pace which could leave market players on the edge again.
Consequently, the market may dither again as investors re-assess the market’s near-term direction that has turned tentative.
However, we think that the selling pressure is not overwhelming for the time being and after its recent pullback, the FBM KLCI could be looking to find some measure of stability.
This could allow the key index to find near-term support around the 1,530 level and halt the downward streak. Below that, the next support is at the 1,520 level while the hurdles are at 1,540 and 1,550 points respectively.
Malacca Securities Research
The FBM KLCI tumbled in tandem with the weak sentiment across the regional bourses as investors took cue from the US stock markets’ slump after the US Fed meeting minutes signalled a faster timetable on interest rate hikes.
We expect stock market to stay volatile and downward bias at least for the near term given Wall Street is still on the pullback phase.
However, investors may look for laggard counters with high earning visibility ahead of the February reporting season.
Commodities\-wise, both crude oil and crude palm oil (CPO) prices continued to trend higher.
The FBM KLCI (-0.9%) drifted lower and broke the previous support at 1,530, dipping below the daily EMA9 and EMA120 level. Technical indicators, however, were positive as the MACD Histogram has extended a positive bar while the RSI hovered above the 50 level.
The next support level is located at 1,505 while the resistance is pegged along 1,560. – Jan 7, 2022
