BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The selling picked up yesterday to send the key index to its lowest level in two weeks and also below the 1,580 support amid the lack of new leads.
As a result, profit taking was widespread among plantation and banking stocks as they continue to consolidate from their recent gains.
At the same time, the broader market and lower liners also saw sustained selling that resulted in market breadth staying decidedly negative.
While market players await for new leads from Budget 2022 to be announced later in the day, market conditions could stay guarded after yesterday’s steep falls.
This means that there could be further downside bias as fresh buying has yet to materialise with most market players still on a wait-and-see stance.
Nevertheless, the market could also be attempting to find some stability and the selling may abate somewhat that could allow the key index to find support around the 1,560 level.
Below that, the other support is at 1,550 points. On the upside, meanwhile, the resistances are at 1,572 points and the 1,580 level.
Hong Leong Investment Bank Research
Following the sharp fall below 200-day moving average near 1,573 and weakening technical readings coupled with fresh US-China trade tensions, a deeper pullback is likely to prevail in the near term with major supports at the 1,549-1,561 territory.
Nevertheless, severe downside risk is cushioned (supports: 1,560-1,573; resistances: 1,600-1,613) by aggressive economic re-opening activities with more states moving to Phase 3 and Phase 4 of the National Recovery Plan (NRP) and high vaccination rate (circa 95% of Malaysian adults had been fully vaccinated by Oct 28).
Moreover, sentiment can also be spurred by elevated commodity prices and mildly positive expectations of another expansionary Budget 2022 to rebuild Malaysia’s economy after almost two years of economic and health crises. – Oct 29, 2021
