What to expect on Bursa Malaysia this Friday

BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:

Inter-Pacific Research

Malaysia stocks surged yesterday as the political impasse ended with the appointment of a new Prime Minister (PM).

As a result, euphoric conditions dominated sentiments, sending the key index back above the psychological 1,500 level. Most of the fresh buying emerged in the afternoon session with foreign funds emerging the day’s big buyers.

Expectedly, market breadth was positive with gainers outpacing losers on a 5-to-1 ratio and on the back of traded volumes surging to nearly 7.0 billion shares for the day.

The near-term market conditions are looking more sanguine, riding on optimism that the new government will introduce market friendly policies as well as critical reforms to the domestic economy to weather the ongoing global economic challenges and beyond.

While there may be some quick profit taking activities that could see some choppiness following yesterday’s hefty gains, market conditions are likely to stay buoyant for the most part that would still be supportive of further near-term gains albeit at a slower pace ahead of the long weekend.

On the upside, the next targets are at 1,507-1,512 points, followed by the 1,520 level. The 1,500 level is the immediate support, followed by the 1,495 and 1,490 levels respectively

Malacca Securities Research

The FBM KLCI witnessed a strong rally after the unity government is formed with Pakatan Harapan (PH) being the largest party in the alliance and PH’s Chairman Datuk Seri Anwar Ibrahim being appointed as Malaysia’s 10th PM.

With foreign investors turning net buyer – snapping a six-day outflow streak and a stronger ringgit – following the conclusive outcome of the 15th General Election (GE15), we believe the local bourse will continue its uptrend move amid rising investors’ confidence.

Besides, the Federal Open Market Committee (FOMC) meeting minutes that saw some of the Fed’s officials turning less hawkish may be perceived as positive to the stock markets.

Commodities-wise, Brent crude and crude palm oil (CPO) prices hovered above US$85/barrel and RM4,000/metric tonne respectively.

The FBM KLCI jumped above the 1,500-level suggesting that the bullish sentiment has emerged. Technical indicators are turning positive with the MACD Histogram narrowed to near zero level while the RSI hooked upwards.

The resistance pegged along 1,530-1,550 while the support is at 1,430-1,450. – Nov 25, 2022

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