What to expect on Bursa Malaysia this Monday

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 took a dive on Friday as steep profit taking activities emerged to send it well below the psychological 1,550 level at the close of the week, particularly on recent big winners like YTL Power International Bhd and Genting Malaysia Bhd.

The selling was also widespread as lower liners also succumbed to further profit taking that saw market breadth well in the negative territory. Also, the selling was manifested in high volumes of nearly 5 billion shares for the day.

With steeper-than-expected profit taking on Friday, conditions are turning unsettled again with fewer market impetuses to entice market players following the end of the results reporting season.

This could once again leave the key index to drift as market players scour for new leads with the economy and interest rate concerns coming into the fore again.

It could also mean that the market’s run-up since the start of the year has run its course and a period of consolidation could be in store for the gains to be absorbed.

For now, however, we see the key index attempting to find some downside bias solace from Friday’s sell-down and look for some stability around the 1,540 level.

However, bouts of selling could still dominate trades with the supports are now lowered to the 1,530 and 1,522 levels while the resistances are at the 1,545 and 1,550 levels respectively.

Malacca Securities Research

After the corporate earnings season and the FBM KLCI hitting the resistance along 1,559 last week, profit taking activities have emerged following the MSCI re-balancing activities.

On Wall Street, the three major indices have surged again; the S&P500 rose towards new highs after the Core PCE (personal consumption expenditures price index) data came in within expectations while investors were focusing on the AI (artificial intelligence) trend and sustainable earnings going forward.

We believe the positive sentiment may spill over towards stocks on the local front this week.

On the commodity market, Brent crude price turned higher above US$83/barrel ahead of the OPEC meeting this week while Gold price has experienced a solid breakout above US$2,050 after softer factory sector output.

The FBM KLCI ended lower after hitting resistance along 1,559 level. The technical readings on the key index were mixed with the MACD Histogram extending another negative bar while the RSI has declined below 70.

The resistance is envisaged around 1,545-1,555 while the support is set at 1,520-1,530. – March 4, 2024

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