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

Malaysian stocks made a strong comeback last Friday to end the week comfortably above the psychological 1,400 level as bargain hunting emerged on many index-linked stocks, particularly on banking stocks.

The gains were in tandem with the market performance of regional equities with buying activity also extending to the broader market, hence enabling gainers to beat losers by more than a 2-to-1 ratio as buying interest returned and lifted total volumes to more than 4 billion shares for the day.

The rebound was stronger-than-expected last Friday as buying interest re-emerged to shore up the key index comfortably above the 1,400 points hurdle.

However, we see market conditions remaining unsettled at the start of the week following Wall Street’s weak closing at the end of last week that could leave the market to ponder over its next moves.

This may see some mild profit taking emerging that could erase some of Friday’s gains even as selling pressure is relatively benign at this juncture.

Any pullback should be well supported to enable the key index to stay above the 1,400 level for the time being with the interim support at 1,406 points. The immediate resistances are at the 1,417-1,420 levels, followed by the 1,423 level.

Malacca Securities Research

The FBM KLCI bounced higher along with the regional markets amid a relief rally in view of a rescue plan for the US banking sector.

Although volatility may persist on the local bourse following Wall Street’s retreat amid lingering concern over the US banking turmoil and Credit Suisse crises, we expect the market to stay calmer as UBS has announced its takeover over Credit Suisse just this morning.

Meanwhile, traders will monitor the US Federal Reserve’s interest rate decision this week.

Commodities-wise, Brent crude is still hovering above US$72/barrel while crude palm oil (CPO) price is trading below RM4,000/metric tonne. Gold prices surged, trading just below USD1,990/ounce as investors rush for safe haven asset.

The FBM KLCI staged a strong rebound to close above the key 1,400 level. Technical indicators however, turned slightly positive as the MACD Histogram is forming a rounding bottom while the RSI has crossed above 30.

The next resistance is located around 1,420-1,440 while support is envisaged along 1,390-1,400. – March 20, 2023

Subscribe and get top news delivered to your Inbox everyday for FREE