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 stumbled yesterday, ending the day below the 1,640 level amid a fresh round of selling by foreign funds in tandem with the weakness among key regional indices.
Fresh concerns over rising bond yields and uncertainties over the next interest rate hike were among the factors affecting the performance of the equity market with selling also extended to the lower liners, causing losers to overwhelm gainers by more than a 2-to-1 ratio. Traded volumes also slipped to just 2.65 billion shares.
With buying interest remaining thin, market conditions are also likely to stay insipid heading into the weekend.
Although key global indices recovered overnight, the positivity may not extend to stocks on Bursa Malaysia as the directionless trading environment will continue to dominate the trading environment, leaving the FBM KLCI to continue drifting.
The on-going concerns over US interest rates, spike in bond yields and China’s uncertain economic outlook coupled with the lack of domestic leads will continue to weigh on the FBM KLCI’s direction.
Consequently, they key index could now linger within the 1,630 and 1,640 levels for now as it attempts to find a base at lower levels. Beyond these levels, the support and resistances are at 1,625 and 1,645 points respectively.
Malacca Securities Research
Sentiment on the local front remained negative, mirroring the performance of regional markets though selected telco & media and healthcare stocks closed significantly higher.
In the US, despite good set of economic data like (i) unemployment claims came in below expectations, (ii) both Flash manufacturing and services PMI exceeded forecasts and (iii) new home sales rose to 738,000 in September (vs 709,000 in August), trading tone was mixed.
The Dow retraced another session but the S&P 500 and Nasdaq rallied, supported by Tesla’s post-earnings surge.
In the commodities market, Brent crude continued to decline despite rising geopolitical tensions in the Middle East. Meanwhile, gold prices rebounded as the greenback weakened after lower-than-expected unemployment claims.
Elsewhere, CPO (crude palm oil) prices traded above RM4,600/metric tonne (MT), reaching a two-year high before closing at RM4,589/MT.
The FBM KLCI index ended lower towards the 1,632 level. The technical readings on the key index were mixed with the MACD histogram having extended another positive histogram but the RSI has trended below 50.
The resistance is envisaged around 1,647-1,652 while the support is set at 1,612-1,617. – Oct 25, 20234
