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 mounted a rebound on Friday to close out the week on a firmer note, boosted by bargain hunting on banking heavyweights.
The upsides were also in tandem with the gains in regional equities on a slew of better-than-expected US corporate earnings.
Even as conditions in the broader market were mixed, total gainers still managed to secure the upper-hand against losing stocks. However, traded volumes slipped further at the end of the week.
The near term outlook still appears mildly positive after the FBM KLCI managed to not only mount a rebound last Friday but also stay above the 200-day moving average line that has become the make or break line.
The ongoing positivity among global equities should also provide more impetus for further upsides that is fortified by a still firm market undertone.
After July’s gains, however, the FBM KLCI’s upsides could be more modest as valuations have also caught up with many stocks are already reflective of their current fundamentals.
This could also see increased volatility as market players rotate to laggards. Amid the potentially slower upsides, the psychological 1,450 levels is the immediate hurdle followed by the 1,455 level.
The supports, meanwhile, are at 1,437 points which is the 20-day moving average and at 1,433 points respectively.
Malacca Securities Research
Bargain hunting activities alongside the return of foreign funds drove the key index higher as the positive performance was also in line with the mostly higher regional markets.
We reckon that the key index may attempt to build onto last Friday’s gains given that sentiment across regional markets has shown signs of improvement.
The lower liners may remain in the consolidation phase with investors prepped for a barrage of quarterly corporate earnings releases while trading activities dwindled.
For now, investors should trade in a cautious undertone ahead of Malaysia’s six state elections this Saturday (Aug 12).
Commodities-wise, Brent crude advanced above US$86/barrel while crude palm oil (CPO) hovered above RM3,800/metric tonne.
The FBM KLCI rebounded after staying afloat for the entire trading session last Friday. Technical indicators, however, stayed mixed as the MACD Histogram extended another negative bar while the RSI remain above 50.
The immediate resistances are located along 1,460-1,480 while the support is pegged around 1,400-1,420. – Aug 7, 2023
