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 succumbed to a steeper profit taking last Friday, moving in-sync with other regional equity indices that reacted to the stumble on Wall Street a day earlier.
The profit taking on the key index was relatively acute but it managed to end the session off its day low and a shade below the 1,620 level.
Broader market shares were also mostly lower with market breadth on the negative side. Similarly, market interest was also more subdued but still at a brisk at 5.6 billion shares for the day.
Near-term market conditions are likely to stay unsettled after the strong uptick over the past few weeks that saw the key index reaching levels not seen in over three years.
The recent gains have also largely reflected the country’s firmer economic undertone and market players are likely to stay pat for now as they await for corporate earnings growth to catch up.
As it is, the on-going corporate results reporting season is heading to its conclusion this week but the reported results have also been mixed thus far.
In any case, there could be further pullback over the near-term as there are fewer compelling buying opportunities that could keep market conditions guarded and with the key index continuing to consolidate its gains for the time being.
On the downside, the supports are at 1,610 and the psychological 1,600 level while the immediate hurdle is at the 1,620 level, followed by the 1,630 level.
Malacca Securities Research
Overall, the Malaysian stock market has taken a healthy pullback following a series of buying support in the past few weeks.
However, we expect bargain hunting activities to emerge this week as most of the corporate earnings will be released this week.
With better-than-expected consumer sentiment and durable goods orders, buying interest on Wall Street has persisted with Nasdaq headed to a fresh all-time-high as traders were positive on the technology sector.
On the commodity markets, Brent crude rebounded off the US$81/barrel zone ahead of the OPEC+ meeting on June 1. Meanwhile, gold price consolidated while crude palm oil (CPO) price rangebound between RM3,855/metric tonne and RM3,925/metric tonne last week.
The FBM KLCI index slid below the 1,620 level. The technical readings on the key index were mildly positive with the MACD Histogram extending a less positive bar while the RSI remains overbought.
The resistance is envisaged around 1,635-1,640 while the support is set at 1,600-1,605. – May 27, 2024
