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 posted minute gains yesterday as profit taking activities ahead of the Lunar New Year break found some support after Bank Negara Malaysia (BNM) left interest rates unchanged.

This allowed the FBM KLCI to buck the mostly lower regional indices while lower liners and broader market shares also tipped higher.

However, their gains were muted as buying interest waned amid the moderating market interest. Market breadth was fairly even with gainers slightly ahead of losers.

We see the FBM KLCI remaining subdued ahead of the extended Chinese New Year break with more unwinding activities to also dominate trades in the day ahead.

This could also see the FBM KLCI ending the week on an indifferent note as buying interest will likely to be low.

Coupled with overnight weakness on key global equity indices, the insipid market trend could be extended, leading to the key index giving up its 1,495-support level. If so, the supports are lowered to the 1,490 and 1,485 levels as there is still modest selling pressure.

This also means that the psychological 1,500 level will remain resolute for the time being due to the still anaemic buying strength. Beyond the 1,500 level, the ensuing hurdle is at 1,512 points.

Malacca Securities Research

The FBM KLCI eked out marginal gains following the decision by BNM to maintain the overnight policy rate (OPR) at 2.75%.

Nevertheless, we expect the sideways trend on the local bourse may turn into a negative- biased environment prior to the Lunar New Year holiday after Wall Street extended its slide amid increasing concerns on softer economic activities going forward and the expectation of the US Federal Reserve’s tone to remain hawkish.

Commodities-wise, Brent crude traded above US$86/barrel while crude palm oil (CPO) price stayed above RM3,850/metric tonne.

The FBM KLCI booked modest gains, heading towards the key 1,500 level. Technical indicators remained positive as the MACD Histogram trended higher while the RSI is hovering above 50.

Should the key index crossed above 1,500, the next resistance is envisaged around 1,510-1,520 while support is located at 1,450-1,460. – Jan 20, 2023

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