BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Profit taking activities took hold yesterday, resulting in the key index shedding some of its recent gains and ending the day below the 1,580 level.
The losses were also in tandem with the weakness among regional indices as optimism over the easing trade war ebbed coupled with fewer noteworthy leads for market players to follow.
The pullback also extended to the broader market shares with total losers beating gaining ones.
Near-term market conditions are likely to remain stable heading into the weekend as concerns over the trade war has eased significantly but further significant gains could also be difficult to come by as much of the market’s positivity has already been reflected.
At the same time, the FBM KLCI’s upsides could pause until the country’s 1Q 2025 GDP (gross domestic product) performance is announced later today to allow market players to assess impact of the US reciprocal tariffs on the country’s economic performance.
Under the prevailing environment, the key index may revert to a sideway trend as it looks to hover close to the 1,580 level where the key index could attempt to build up a base.
Above the 1,580 level, the targets are at the 1,583-1,586 levels and at 1,590 points respectively. The supports, on the other hand, are at 1,570 points and 1,565 points respectively.
Malacca Securities Research
Despite Wall Street’s mostly positive performance, we expect profit taking activities to persist in the local front.
Indonesia’s plan to raise its crude palm oil export levy from 7.5% to 10% (effective May 17) should benefit Malaysian plantation players by enabling them to extend their gains in the sector.
Meanwhile, breakouts were observed in selected poultry counters, namely Teo Seng Capital Bhd and Leong Hup International Bhd, as the market re-positioned into domestic-driven stocks.
On the defensive front, REITs could gain attention amid global tariff uncertainty with Sunway Real Estate Investmett Trust (SUNREIT) and Pavilion Real Estate Investment Trust (PAVREIT) reporting year-on-year (yoy) net property income growth of 20% and 5% respectively.
The key index continued to trade above the MA (moving average) lines with technical indicators showing positive signals. The MACD histogram has expanded positively while the RSI is approaching 70.
Resistance is anticipated around 1,588-1,593 while support is located at 1,553–1,558. – May 16, 2025
