BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The FBM KLCI gave up gains it attained a day earlier as follow through buying interest failed to materialise that left it to drift again.
There remain few impetuses for market players to follow domestically while the US Federal Reserve’s reiteration of further interest rate hikes caused some hesitation albeit regional indices were mostly higher.
This also resulted in many lower liners succumbing to profit taking and market breadth turning negative again. The increased selling also saw traded volumes jumping past the 3 billion shares mark again.
The FBM KLCI continues to buck the global and regional uptrend to remain a laggard, unable to garner sufficient strength to mount a decent recovery on the combination of insipid earnings growth prospects, continuing foreign selling and tepid buying interest.
As a result, sentiments are still indifferent and is likely to remain so over the immediate term with no change to the immediate market view.
This could see the key index remaining insipid again and its ability to hold on to the 1,380 support is still suspect.
Nevertheless, we think the key index could attempt to find some support around the current levels ahead of the mid-year window dressing activities.
Hence, its weakness could be supported by bouts of support from local institutions with the immediate supports pegged at the 1,375-1,377 levels, followed by the 1,370-1,373 levels. On the upside, the resistances are at 1,385-1,387 points and 1,390 points respectively.
Malacca Securities Research
The FBM KLCI slid on the back of profit taking activities as the US Federal Reserve’s hawkish signal sparked worries over two more potential rate hikes in 2023.
Nevertheless, we believe the overall sentiment has turned more optimistic given the rally in technology giants in the US as well as the recent rate cut in China which may boost more economic activities going forward.
Commodities-wise, Brent crude price jumped above the US$75/barrel mark while crude palm oil (CPO) price hovered above RM3,500/metric tonne.
Once again, the FBM KLCI declined below its daily EMA9 level. Technical indicators remained mixed as the MACD Histogram extended a positive bar while the RSI hover below 50.
Support is pegged along 1,370 while the resistance is set along 1,400-1,410. – June 16, 2023
