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 was still southbound amid the increasingly tepid market sentiments that was caused by the volatile global equity markets.

The increased selling resulted in the key index whittling down to the 1,440 support after it lingered in the negative territory for the entire session on Wednesday.

The broader market also mirrored the weakness with most stocks losing ground and market breadth decidedly in the red. Market interest also thinned slipping below 3.0 billion shares for the day.

With the key index falling to successive support levels, the near-term outlook remains dour, undone by the renewed concerns over the slowing global and domestic economies that are likely to keep market sentiments in check.

The earlier bargain hunting has turned to cautiousness, and this is likely to weigh on the market for longer that could also keep market participants at bay.

Under the prevailing environment, the downside risk looms large and the 1,400 level also remains under threat. However, we think that light bargain hunting may emerge ahead of the end of 3Q 2023 that could help to arrest the downtrend streak.

The slight reprieve in the global equity market’s weakness trend could provide the impetus to promote some bargain hunting among the recent big losers.

The mild gains could see the key index test the immediate hurdle at 1,445 points, before attempting to pass the 1,447-1,450 levels. The supports, meanwhile, are at the 1,435 and 1,430 levels.

Malacca Securities Research

The FBM KLCI traded in the negative territory prior to the public holiday while investors were focusing on the energy sector amid the rebound in Brent oil prices.

In the US stock markets, buying interest emerged within Nasdaq or growth stocks after the 10-year US Treasury yield dropped from its 15-year high.

Also, traders will be looking at the Personal Consumption Expenditure that will be released later tonight for more clues from the US Federal Reserve on its tone going forward.

Besides, we believe the upside on Wall Street may be limited as the US government is facing a shutdown if the US Congress is not able to pass a funding plan by end-September.

Commodities-wise, Brent crude oil traded on a volatile manner within the range of US$93-US$95/barrel level while crude palm oil (CPO) prices rebounded strongly near the RM3,800/metric tonne level.

The FBM KLCI ended lower and still trading below the 1,450 psychological level. Also, the technical readings on the key index were negative with the MACD Histogram turning lower and the RSI is below 50.

The resistance is located around 1,465-1,470 while the support is envisaged around 1,430-1,440. – Sept 29, 2023

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