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 rebounded yesterday following two days of profit taking with the return of bargain hunting activities, particularly on healthcare stocks that were the day’s big movers on the emergence of a new COVID-19 strain.
Conditions in the broader market also stayed sanguine as many of these stocks sustained their gains with more market players returning to the market.
Consequently, market breadth stayed positive while traded volume improved further to surpass the 4 billion-share mark.
As market conditions are displaying early signs of strength, there could be further near-term gains with the return of fresh buying interest and bargain hunting activities that have already enabled the FBM KLCI to stage a rebound yesterday.
However, we think there could be some choppiness ahead due to the overnight weakness of key global indices that could also prompt bouts of profit taking on the key index.
The volatility may see the key index giving up some of yesterday’s gains but the market should hold up for the most part as selling pressure is still mild and there are still pockets of fresh buying that should keep the market steady.
As such, the FBM KLCI is likely to find support above the 1,540 level and potentially even making an attempt at the 1,550 level. If so, the next hurdle is at 1,560 points while the other support is at the 1,535 level.
Malacca Securities Research
The FBM KLCI rebounded from its two-day decline as investors bought the dip, especially in healthcare heavyweights on the back of concerns over emergence of COVID-19 IHU variant.
However, local sentiment may turned cautious, tracking the negative performance on Wall Street overnight performance following the December US Federal Reserve meeting minutes which suggested the tone is more hawkish and the market may anticipate faster rate hikes and quicker tapering progress.
Meanwhile, crude palm oil (CPO) price hovered around RM5,000/metric tonne while crude oil price rose above the USD80/barrel mark.
The FBM KLCI snapped a two-day losing streak to stay above the EMA9 level. Technical indicators were positive as the MACD Histogram has extended a positive bar while the RSI hovered above the 50 level.
The support level is pegged along 1,530 while the resistance is set at 1,560. – Jan 6, 2022
