BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian stocks posted a strong recovery yesterday, taking out the 1,550 hurdle at the close amid renewed bargain hunting on selective index heavyweights on optimism over interest rate cuts on the horizon.
The positivity also extended to the broader market with the key lower liner barometers registering gains of nearly 1.0% each.
Expectedly, market breadth was positive with gainers nearly twice the number of losers. However, traded volumes slipped by nearly a quarter.
Yesterday’s gains confounded expectations for a mild rebound as the renewed buying interest was stronger-than-expected.
With the key index breaching the 1,550 hurdle, the near-term market conditions appear more sanguine with the FBM KLCI looking to build on the gains to make further headway.
However, bouts of quick profit taking could also emerge that may temper some of the upside potential and leave market conditions choppy.
This follows the weak performance on Wall Street overnight with the insipid sentiments likely to permeate to Bursa Malaysia.
As such, the choppy market environment could take hold to leave the key index to drift again. The immediate support is the 1,550 level, followed by the 1,545 level while the hurdles are at 1,557 points and the 1,560 level which is also the most recent high and could serve as a major resistance.
Malacca Securities Research
The FBM KLCI turned stronger after a one-day sell-down with the help of industrial products heavyweight like Press Metal Aluminium Holdings Bhd.
Also, we believe the market is focusing on the small caps and lower liners given the fresh 52-week high seen in FBM Small Cap.
The US stock markets extended its negative performance observed on three of the major indices, each ending more than 1% loss.
The market is pricing in further delays in the US Federal Reserve’s interest rate cuts as the inflationary may remain elevated amid the spike in oil prices.
On the commodity front, Brent crude charged above US$91/barrel contributed by the heightened geopolitical tension in the Middle East region. Meanwhile, crude palm oil futures (FCPO) price is hovering above RM4,300/metric tonne while gold price is hovering along its 52-week high.
The FBM KLCI index ended higher. The technical readings on the key index were positive with the MACD Histogram extending another positive bar while the RSI broke above 50.
The resistance is envisaged around 1,570-1,575 while the support is set at 1,535-1,540. – April 5, 2024
