What to expect on Bursa Malaysia this Thursday

BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:

Inter-Pacific Research

After failing to clear the 1,500 resistance, the FBM KLCI succumbed to profit taking yesterday as some of its recent strong gains are digested.

The pullback was also in tandem with the weakness among most regional indices with banking stocks emerging the main losers for the day.

Broader market conditions were similarly weaker with stocks in the FBM Small Cap and FBM ACE seeing increased profit taking. However, the selling was on thinner volumes of 5 billion shares.

With the major 1,500 hurdle proving significant to clear, there could more near-term pullback as the FBM KLCI continues to adjust from its bout of overbought.

However, the consolidation would be deemed as healthy for the gains to be digested, particularly as the recent upsides were largely on bargain hunting from last year’s falls and not accompanied by improvements in the corporate fundamentals where earnings growth are still be relatively benign in 2024.

At the same time, the key index has also played catch up to the gains in many regional indices that outperformed it last year.

With the consolidation looking to continue, the immediate support is at the 1,480 level which is followed by the 1,477 level. On the flipside, the key index’s immediate hurdle is at the 1,488-1,490 levels, followed by the 1,495 level.

Malacca Securities Research

As expected, the FBM KLCI took a pause after the rally, snapping the six-day winning streak as profit taking activities emerged within selected banking and utilities heavyweights.

Meanwhile, the US stock markets closed higher for the session in anticipation of the CPI (later tonight) and PPI (Friday) data that will be released this week.

Over to the crypto segment, the SEC has approved 11 spot Bitcoin exchange-traded funds (ETF) which contributed to a positive sentiment for the crypto markets.

Meanwhile, Brent crude price continues to hover around the US$76/barrel mark as the rising US inventories offset concerns over the Middle East geopolitical tension.

The FBM KLCI ended lower after six days of consecutive gains. The technical readings on the key index were positive with the MACD Histogram extending another positive bar while the RSI dropped but maintains above the 50 level.

The resistance is envisaged around 1,500-1,510 while the support is set at 1,470-1,480. – Jan 11, 2024

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