BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian equities took a dive yesterday, erasing more than the gains it attained on Monday as sentiments returned to a dour note due to lingering uncertainties over the global economic outlook.
This resulted in the key index plummeting to below the 1,650 level to end the day a shade below the 1,640 level.
In the broader market, it was also a sea of red with all Bursa sector indices ending the day lower. Expectedly, market breadth was negative with volumes also still thinning.
The global equity market volatility continues to affect stocks on Bursa Malaysia that also sent the key index to its lowest level in two weeks yesterday.
However, the FBM KLCI’s undertone remains firm for the most part as the key index has managed to preserve the bulk of its YTD (year-to-date) gains despite the recent choppy market conditions.
As such, the overall positive outlook still holds for now, backed by the prognosis of a stronger economic outlook.
With global equities making a strong rebound overnight, the FBM KLCI could also mount a quick rebound that should allow it to regain some traction.
While a rebound is in the offing, the upsides may still be relatively benign due to the prevailing low market following.
Therefore, the key index could recover to around the 1,642-1,647 levels for now, followed by the 1,650 level. On the other hand, the supports are at 1,635 and 1,630 points respectively.
Malacca Securities Research
Selling pressure was observed across the broader market, driven by the PETRONAS and Petros developments and weak Brent oil prices, causing small-cap stocks to dip further.
In the US, Wall Street managed to trade off its lows despite a slight uptick in core CPI (consumer price index) data which came in at 0.3% compared to the 0.2% consensus.
Although the CPI was largely in line with expectations, investors are now shifting their focus to the upcoming PPI (producer price index) data and the Federal Open Market Committee (FOMC) meeting next week.
In the commodities market, Brent crude recovered above US$70/barrel after inventories rose by 800,000 barrels, slightly below the consensus of 900,000 barrels. Gold prices remained steady above US$2,500/oz as traders look ahead to the FOMC meeting. Meanwhile, crude palm oil (CPO) continues to trade below RM3,900/metric tonne.
The FBM KLCI index closed lower towards the 1,639 level. Additionally, the technical readings on the key index were negative with the MACD histogram forming another negative bar and the RSI dipping below 50.
The resistance is envisaged around 1,654-1,659 while the support is set at 1,619-1,624. – Sept 12, 2024
