BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian equities made firm gains yesterday as it played catch up to the gains in key global indices during the Lunar New Year break to climb back above the 1,520 level.
Banking and oil & gas (O&G) stocks led the key index higher while the broader market shares and lower liners also saw some bargain hunting that helped them closed mostly higher.
As a result, market breadth stayed positive but traded volumes were just a shade over 2 billion shares as many players were still on their break.
The near-term outlook could turn choppier ahead of the weekend as it remains to be seen if follow-through buying interest would materialise after the sharp pullback of global indices overnight.
The weaker sentiments due to Meta Platform Inc’s (previously Facebook Inc) lower earnings could leave market conditions uncertain again with prompt quick profit taking instead.
At the same time, there are also few fresh catalysts to draw in market players. This could curb further bargain hunting that could lead to many index-linked stocks to drift again as the buying fades.
Therefore, the 1,520 level is vulnerable and if it is breached, the next supports are pegged at the 1,512-1,515 levels. Meanwhile, the resistances are at the 1,528-1,530 levels followed by the 1,532 level.
Malacca Securities Research
The FBM KLCI roared back strongly on Thursday in a post-Chinese New Year trade but trading remained thin as investors were cautious amid mixed sentiment across regional markets.
Following another round of sell-off on Wall Street led by Meta Platforms on the back of poor earnings, we reckon regional stock markets to remain fragile which eventually may spill over to stocks on the local front.
Commodities-wise, crude oil stayed firm above the US$91/barrel mark while crude palm oil (CPO) price hovered above RM5,500/metric tonne.
The FBM KLCI climbed steadily throughout the session yesterday, closing above the SMA50 and daily EMA9 level. Technical indicators are gradually improving; the MACD Histogram has turned flat while RSI is heading towards 50.
Resistance is pegged along 1,530-1,570 while the support is located at 1,505. – Feb 4, 2022
