BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
There were more downsides to Bursa Malaysia with the key index ending the week on another losing note.
Concerns over the slowing domestic economy amid higher inflation left market conditions in a lackluster mode which was also in tune with the weakness among regional indices.
Lower liners also continued to retreat, losing ground in an increasingly thin market as traded volumes slipped below 2 billion shares transacted on Friday (Sept 23).
Market conditions are likely to stay lackluster over the near term on the continuing move away from equities as the rising possibility of a global recession and slower Malaysian economy would still be overshadowing investor sentiments.
As such, the downside risk remains even as the FBM KLCI’s technical indicators are already bordering oversold.
With few signs of a rebound as yet – coupled with the sustained weakness on most global equity indices – selling looks to continue at the start of the week, particularly as foreign funds are still looking to offload their positions due to the weakening ringgit.
This could result in the key index testing the 1,420 level again and if it gives way, the support is lowered to 1,410 points, which is close to the year low recorded in July.
On the upside, the resistances are at 1,430 and 1,436 points respectively.
Malacca Securities Research
The FBM KLCI tumbled as a persistent risk-off undertone, coupled with foreign fund outflow (fie-day cumulative stood at RM562.5 mil) led to a broad-based sell-down on the local bourse.
While the cautious sentiment is likely to continue, we may see milder selling pressure as investors could pick up undervalued stocks and trade ahead of the tabling of Budget 2023 on Oct 7.
Commodities-wise, Brent crude price slumped to trade around the US$86/barrel mark while crude palm oil (CPO) price continued to consolidate around RM3,700/metric tonne.
The FBM KLCI tumbled with the key index extending losses for the third straight session to breach below the earlier support of 1,430. Technical indicators remained negative as the MACD Histogram extended a negative bar while the RSI hovered below 50.
Support is set along 1,400-1,410 while resistance is pegged at 1,450-1,460. – Sept 26, 2022