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 continues to lose ground, slipping below the 1,600-level last Friday as selling escalated after the unveiling of the country’s GDP (gross domestic product) that was largely within expectations.
Market conditions stayed subdued with market interest also slipping further with losers still dominating trades and beating gainers for the day.
Nevertheless, the lower liner indices ended the day mixed with the Small Cap index posting slight losses while the ACE Market posted marginal gains.
Last Friday’s continuing decline not only saw the psychological 1,600 level breached but also the critical 200-day moving average line at 1,595 points.
With the breach, the FBM KLCI’s uptrend came to an end with a bearish trend likely to seep in to keep the downtrend intact for now.
With market conditions to stay dour, the selling spree looks to continue with hopes for a quick bounce back above the 200-day moving average line appearing slim at this juncture.
The end of the uptrend could also continue to undo some the key index’s YTD (year-to-date) gains with the market outlook becoming more challenging due to an increasing wary equity market outlook with Donald Trump’s return to the US presidency next year.
On the downside, the supports are now pegged at 1,590 points and 1,585 points respectively. The 200-day moving average line at 1,595 is the immediate resistance, followed by the 1,600 level.
Malacca Securities Research
The FBM KLCI retreated below the 1,600 level despite Malaysia’s 3Q GDP recording a growth of 5.3% year-on-year (yoy).
Extending last week’s global sell-offs, we expect most Asian stocks to start the week on a softer note as investors price in the potential impact of Trump’s tariff policies potentially reigniting inflation and a slower interest rate easing cycle expected in 2025.
This week, traders will monitor key events, including (i) the speech by Bank of Japan (BOJ) governor; (ii) NVIDIA’s earnings release; (iii) the G20 Summit in Brazil; and (iv) China’s loan prime rate announcements.
In the commodities market, Brent crude retreated towards the US$70/barrel level as OPEC+ lowered its oil demand outlook. Gold prices hovered around the US$2,570/oz level while CPO (crude palm oil) prices traded below the RM5,000/metric tonne psychological level due to a slowdown in exports.
The FBM KLCI index retreated below the 1,600 level to close at 1592.44. Meanwhile, the technical readings on the key index were negative with the MACD Histogram closing downwards and the RSI is trending below 50.
The resistance is envisaged around 1,607-1,612 while the support is set at 1,572-1,577. – Nov 18, 2024
