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 another tumble last Friday to close at the 1,630 level – its lowest level since mid-August as selling by foreign funds persisted.
The weakness also bucked the mostly positive regional equity market performances that were buoyed by China’s stimulus measures.
Energy stocks were the big movers but the broader market remained insipid and market breadth was again on the negative side. Traded volumes also eased further to just slightly above 3.0 billion shares traded.
Amid the continuing profit taking by foreign funds as they divert their attention to greater China equities, the weakness on Bursa Malaysia is likely to prevail for the time being.
As it is, successive support levels on the FBM KLCI have been broken due to the continuing profit taking with few reprieves in sight despite the corporate fundamentals of Malaysian equites remaining intact.
Consequently, the weakness spell looks to prevail for longer as conditions are likely to stay insipid with market players awaiting for the profit taking spell to run its course.
Fresh buying interest could also be scant for now due to few available domestic catalysts, leading the key index to potentially drift further.
On the downside, the supports are now pegged at 1,625 and 1,620 points respectively. Meanwhile, the resistances are at the 1,635-1,640 levels, followed by the 1,647 level.
Malacca Securities Research
The FBM KLCI experienced a volatile ride over the past few trading days, fluctuating between positive and negative territory due to heightened concerns over tensions in the Middle East.
Meanwhile, US stock markets closed on a positive note, rebounding from intraday lows after non-farm payrolls in September exceeded expectations, signalling that the economy remains strong at this point.
In the commodities market, Brent crude surged to nearly US$80/barrel, driven by developments in the Middle East while gold prices hovered around the US$2,650/oz mark.
Crude palm oil (CPO) closed at RM4,300/metric tonne, supported by rising demand from India, the top importer, ahead of the Diwali festive season coupled with the release of China stimulus packages
The FBM KLCI index closed lower towards the 1,629 level, violating below the long-term MA. However, the technical readings on the key index were negative with the MACD histogram formed another negative bar but the RSI trended below 50.
The resistance is envisaged around 1,644-1,649 while the support is set at 1,609-1,614. – Oct 7, 2024
