BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian stocks ended the week on a whimper with the increased profit taking erasing all the gains it attained during the week.
Telco stocks again were the main losers after the euphoria over their stakes in Digital Nasional Bhd and the potential implementation of 5G services subsided.
Market breadth was still negative even as many of the lower liners and broader market share indices made headway. At the same time, traded volumes continue to thin.
Following Friday’s pullback, market conditions are looking more precarious as support appears thinner which may mean that the downsides may persist at the start of the week.
As it is, buying interest has been thinning over the past few sessions amid the lack of new leads even as the corporate results reporting is ongoing.
This could leave the key index to continue consolidating its position after the gains in July with the key index now attempting to fortify a base around the 1,500 level which is also its immediate support.
Below that, the other support is at the 1,495 level. On the other hand, the hurdles are at 1,505 and 1,515 levels respectively.
Malacca Securities Research
The FBM KLCI drifted lower last Friday in tandem with most of the regional markets as persistent selling pressure were noticed following the elevated inflation data in the European region.
With the global investors reassessing the risks of interest rate hikes by the US Feds moving forward, growth stocks may see some selling pressure.
Nevertheless, we believe traders on the local bourse may remain cautiously optimistic amid the earnings season while monitoring Malaysia’s inflation rate that will be released this Friday (Aug 26).
Commodities-wise, Brent crude hovered around US$96/barrel while crude palm oil (CPO) is priced above RM4,000/metric tonne.
The FBM KLCI ended lower for the third consecutive session, falling below its daily EMA9 level. Technical indicators, however, remained positive as the MACD Histogram extended a positive bar while the RSI hovered above 50.
Resistance is pegged along 1,530-1,560 while the support is set around 1,460-1,480. – Aug 22, 2022
