What to expect on Bursa Malaysia this Monday

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 ended last week on a whimper as profit taking dominated trades to send it back to the 1,480 level at Friday’s close.

Much of the sustained profit taking were on the banking stocks as the finance index slipped for the fifth straight day despite energy stocks continuing to make headway.

Meanwhile, the lower liners and broader market shares extended their gains on improved volumes in what is seen as continuing year-end window dressing activities to help market breadth stay positive.

The FBM KLCI is likely to stay mixed at the start of the week as institutional players are still on a tentative mode, awaiting for a more definitive market direction before making more market moves.

However, overall market sentiments have improved with the formation of a new government that could give the market the much-needed calmness and stability to forge ahead.

Market players will be monitoring the new government’s moves to fortify the country’s economic prospects in the face of the ongoing headwinds.

For now, the 1,480 level should hold but upsides could still be capped at around the 1,500-level due to the continuing tentativeness.

Below the 1,480 level, the support is at 1,469 points while the interim hurdle is at 1,490 points.

Malacca Securities Research

The FBM KLCI notched lower on Friday as stock rally ran out of steam with buying momentum turning to the broader market.

The market sentiment was mixed on the global front as worries over inflation reignited following the release of US labour market report that showed strong data on wages.

Meanwhile, the easing of COVID-19 restrictions in China may indicate a shift towards economic reopening.

On the local front, the formation of the new Malaysia cabinet may improve investors’ confidence on political stability. Commodities-wise, Brent crude price traded above US$85/barrel while the crude palm oil (CPO) price plunged towards RM3,950/metric tonne.

The FBM KLCI retreated as bulls failed to extend amid declined trading volume. Technical indicators remained positive as the MACD Histogram extended a positive bar while the RSI hovered above 50.

Support is located at 1,450-1,460 while the resistance is pegged along 1,500-1,510. – Dec 5, 2022

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