BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
There was no reprieve for stocks on Bursa Malaysia as the downward streak accelerated after the 1,600-point support level gave way two days ago, hastening profit taking activities after the key index’s strong YTD (year-to-date) gains.
Selling activity also extended to the broader market amid the lack of leads and the corresponding buying interest.
Consequently, market breadth remained in the negative territory with losers more-than-doubled the number of gainers. Traded volumes slipped to just over 5 billion shares for the day.
We still see little reprieve for Malaysian equities as the market is turning directionless after the key index failed to find support above the psychological 1,600 level.
The breach of the level could result in more profit taking activities as market players may now opt to retreat to the sidelines until there is more clarity on the key index’s direction.
There are also fewer compelling buying opportunities with many of the near-term positives having already been reflected in the valuations even as the valuations are still below their historical averages.
Therefore, the key index could end the week on a lacklustre note again with the supports now pegged at 1,590 and 1,583 points while the immediate resistance is at 1,595 points, followed by the 1,600 level.
Malacca Securities Research
Another down day on Bursa exchange as profit taking activities still persist of which we believe the FTSE re-balancing activities could be the reason for the softer sentiment in the market.
Meanwhile, the US stock indices ended mixed as the market assessed weaker economic data as building permits came in below expectations while unemployment claims rose more-than-expectations. Both the S&P500 and Nasdaq retreated from record highs led by the technology sector while the Dow Jones ended 0.77% higher.
On the commodity markets, Brent crude headed higher above US$85/barrel while gold price gained momentum above US$2,330/oz. Meanwhile, CPO (crude palm oil) price is still hovering in the RM3,900-RM4,000/metric tonne range.
The FBM KLCI index ended lower by dipping below the 1,595 level. The technical readings on the key index were negative with the MACD Histogram forming another negative bar while the RSI dropped below 50.
The resistance is envisaged around 1,610-1,615 while the support is set at 1,575-1,580. – June 21, 2024
