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 equities mounted a rebound last Friday, breaking its streak of steep falls a few days prior.

As it is, bargain hunting emerged on some of the beaten down sector leaders to help the FBM KLCI to rebound from the 1,480 level.

At the same time, many lower liners also found support after a few wretched sessions where some of these stocks were sold down. Consequently, market breadth returned to positive side as the bargain hunting returned.

The stock market could continue to mount a rebound after last week’s sell-off that severely impacted investor sentiments.

As it is, the FBM KLCI is finding some measure of stability as the sell-down was seen as a contagion effect of the tumultuous conditions among the speculative lower liners and not due to a breakdown in the market’s fundamentals.

The rebound from last week could also allow the key index to find further stability over the near-term with the worst of the sell-off likely to be over.

Consequently, this could further help the key index to fortify its recovery with the key index likely to target the 1,490-1,492 levels next. Beyond that, the other hurdle is at the 1,495 level with the supports pegged at 1,480 and 1,476 points respectively.

Malacca Securities Research

The FBM KLCI rebounded after a three-day pullback amid buying support in the banking and utilities segments.

Meanwhile, the US stock markets ended stronger led by the chipmakers fuelled by optimism around the artificial intelligence (AI) theme with the S&P 500 hit fresh record highs after two years.

This rally was followed by TSMC (Taiwan Semiconductor Manufacturing Company Ltd) commenting that the outlook is encouraging amid booming demand for high-end chips used in AI.

Currently the US 10-year Treasury yield stood at 4.126% while the probability of a rate cut is declining.

On the commodity markets, Brent crude price continues to traded sideways, ranging around US$78-US$79/barrel despite the on-going tension in the Middle East.

The FBM KLCI rebounded after three days of consecutive losses. The technical readings on the key index are however mixed with the MACD Histogram extending another negative bar while the RSI maintains above the 50 level.

The resistance is envisaged around 1,510-1,520 while the support is set at 1,460-1,470. – Jan 22, 2024

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