BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian equities regained some ground last Friday after a brief pullback a day earlier to end the week just shy of the 1,600 level again.
There was also renewed mild bargain hunting from foreign funds that aided the key index’s recovery and the market’s breadth was positive on increased strong rotational play into property and construction stocks.
The rebound also saw higher participation with nearly five billion shares exchanging hands.
The near-term outlook remains sanguine with market sentiment continuing to be buoyed by the combination of easing pandemic conditions, resumption of most economic activities and elevated commodity prices.
With many of the sector leaders already seeing their valuations nearing expensive levels due to their recent gains, rotational plays will continue to dominate trades over the near term.
These activities will help to sustain the uptrend on Bursa Malaysia and could also allow the FBM KLCI to breach the psychological 1,600 level again despite it being still near toppish levels.
Above the 1,600 level, the next targets remain at 1,610 and 1,630 points. The supports, meanwhile, are at the 1,590 and 1,580 levels respectively.
Malacca Securities Research
The FBM KLCI advanced on Friday in tandem with its regional peers following the positive cues from Wall Street lifted by optimism in the corporate earning seasons as well as the improved labour data.
We expect buying momentum to persist on the local front following a streak of buying interest from foreign funds.
Meanwhile, the relaxation in SOPs (standard operating procedures) and the movement of Klang Valley, Melaka and five other states into the next phase of the National Recovery Plan (NRP) would continue to drive the recovery theme stocks.
Meanwhile, both the crude palm oil (CPO) and crude oil prices rose; the latter is trading above the US$85/barrel mark at the time of writing.
The FBM KLCI rebounded from the previous session loss as the key index traded near the 1,600 psychological level. Technical indicators remained positive as the MACD Histogram has extended a green bar while the RSI continued hovering mildly below 70.
Resistance is envisaged along 1,605-1,620 while the support is located at 1,580. – Oct 18, 2021
