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 mounted a rebound yesterday to climb back to the 1,640 level at the close, boosted by a revival of buying interest from foreign investors who have been sellers over the past two weeks.
The gains were also in tandem with regional market indices brought about by renewed optimism over China’s stimulus measures.
In the same vein, most lower liners also tipped higher, allowing for market breadth to turn mildly positive albeit market interest slipped again to just 2.6 billion shares traded.
Despite yesterday’s recovery, we continue to think that the cautious market conditions will continue to dominate trades over the near-term as much of the wait-and-see stance will continue for now.
This could also see some quick profit taking activities emerging but speculation over China’s stimulus measures may still provide a reason for market players to keep invested for longer.
Therefore, any pullback may be shallow with bouts of bargain hunting to maintain much of the key index’s recovery from the 1,630 level.
Nevertheless, significant upsides could be difficult to come by due to low market participation.
As such, the 1,645 level would still be the immediate hurdle, followed by the psychological 1,650 level. The supports, meanwhile, are at 1,635 and 1,630 points respectively
Malacca Securities Research
The FBM KLCI and FBM Small Cap indices rebounded slightly in line with the positive performance of regional markets.
Meanwhile, US stock markets took a breather near all-time highs after CPI (consumer price index) and Core CPI data exceeded expectations.
Traders are now focusing on the upcoming PPI (producer price index) data to gauge the US Federal Reserve’s future interest rate moves.
Currently, markets are pricing in an over 80% chance of a 25 basis points (bps) cut at the November FOMC (Federal Open Market Committee) meeting.
In the commodities market, Brent crude surged over 3%, driven by on-going concerns in the Middle East and expectations of rising energy demand in the US and China following the release of stimulus packages.
Gold also rebounded, moving slightly above US$2,630/oz while crude palm oil (CPO) rose closer to RM4,300/metric tonne.
The FBM KLCI index closed higher at the 1,640 level. Meanwhile, the technical readings on the key index are improving with the MACD histogram having formed the rounding bottom formation but the RSI is still below 50.
The resistance is envisaged around 1,655-1,660 while the support is set at 1,620-1,625. – Oct 11, 2024
