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

Malaysian stocks lost ground again yesterday as the selling pressure remained on fears of further bank troubles in the US and Europe.

As a result, the sentiment on Malaysian banking entities were also affected and they emerged as the biggest losers again.

Many broader market stocks also retreated on the back of the weak sentiments and leaving market breadth on the negative side again with losers more than thrice the number of gainers.

Nevertheless, there should be some reprieve for Malaysian equities heading into the weekend as rescue packages have emerged for the distressed banks in the US and Europe that calmed global equity markets overnight.

This positivity should permeate to Bursa Malaysia and stoke fresh bargain hunting actions on some of the recently beaten down stocks, particularly banking stocks that bore the brunt of the sell-off over the past few sessions.

The renewed buying should also help the key index to extricate from its fresh year-low that was formed yesterday and to possibly climb back above the 1,400 level to end the week. The other resistance is at 1,406 points while the supports are at 1,390 and 1,383 points respectively.

Malacca Securities Research

Resurfaced fears over global banking crisis has once again sent the FBM KLCI below the key 1,400 mark but we expect a broad-based rebound on the local bourse amid increased optimism on Wall Street over the banking industry following a joint rescue on First Republic by several big US banks.

Nevertheless, the rebound could be short-lived as investors are likely to trade in a cautious mode while keeping an eye on the US Federal Reserve’s interest rate decision next week.

Commodities-wise, Brent crude oil traded above US$74/barrel while crude palm oil (CPO) price hovered above RM3,900/metric tonne.

The FBM KLCI retreated and sank below the 1,400 level. Technical indicators remained negative as the MACD Histogram extended a negative bar while the RSI is hovering in the oversold zone.

Investors may monitor next support at 1,370-1,380 and resistance at 1,420-1,440. – March 17, 2023

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