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

The FBM KLCI remained on the ascend yesterday but the gains were more modest after it surrendered most of its intraday gains towards the end of day.

Banking and energy stocks were again the main contributors to the key index’s gains in what is seen as continuing mild window dressing activities.

Conditions in the broader market, however, were more subdued due to the low market following with many stocks retreating and market breadth turning negative again.

We continue to see market conditions remaining lacklustre over the near term due to the mostly cautious market undertone that is keeping many market players on the sidelines while traded volumes have thinned.

As it is, there are few compelling leads for market players to follow and this is likely to prolong the market indifference, particularly as the state elections are drawing closer that could keep sentiments guarded for longer.

Going into the final trading day of the week, mild bargain hunting and window dressing activities could persist and may allow the key index to take another stab at the psychological 1,400 level.

However, the upsides could also be capped by low follow through buying interest and bouts of selling into strength that could limit the upsides. There is an immediate hurdle at the 1,396 level while the supports are at 1,390 and 1,385 points respectively.

Malacca Securities Research

The FBM KLCI gained for the third consecutive session, spurred by bargain hunting activities in selected banking and telecommunications & media heavyweights.

In our view, the market may remain cautiously optimistic while monitoring the development from global central banks as well as the six-state elections in Malaysia especially after the Kelantan state assembly dissolved yesterday.

Commodities-wise, Brent crude price fell below the US$75/barrel mark while crude palm oil (CPO) price hovered above RM3,550/metric tonne.

The FBM KLCI posted marginal gains to hold above its daily EMA20 level. Technical indicators were set to be turn slightly positive as the MACD Histogram extended a positive bar while the RSI is approaching 50.

Resistance is envisaged along 1,400-1,440 while the support is set around 1,370. – June 23, 2023

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