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 strong bounce yesterday, buoyed by hopes of a de-escalation of the trade war as the US and China will meet soon to iron out a potential trade deal.
The positivity also allowed the key index to end a hair below the psychological 1,550 level – its highest level in two months.
Construction stocks were among the main movers amid more developments in the country’s data centre sector. Market breadth was positive with traded volumes little changed from a day earlier.
Near-term market conditions are still positive amid the key index’s march towards the psychological 1,550 level which could be breached due to the prevailing positivity that stems from the easing trade conflicts between the US and its main trading partners, particularly with China.
The return of foreign institutional buying has been instrumental in lifting the key index of late while their sustained buying interest could lift the key index further, riding on the prevailing market positivity.
However, the upsides could become more modest following the more than decent recovery from the tariff induced sell-down two months ago with valuations reaching their historical forward averages.
Therefore, fresh buying interest may ease and the upsides could become more modest with the ensuing resistances pegged at 1,555 points and 1,558 points respectively. The supports, meanwhile, are at 1,543 points and 1,540 points respectively.
Malacca Securities Research
Following strong earnings releases from Mr DIY Group (M) Bhd and the ringgit’s appreciation over 6% since its April 9 low, we see trading opportunities in Consumer Products & Services heavyweights – a defensive play – with key focus on Mr DIY, 99 Speed Mart Retail Holdings Bhd and Eco-Shop Marketing Bhd (upcoming IPO).
Given Nvidia’s positive moves amid potential revision to chip trade restrictions, buying interest should return locally, particularly in the technology sector.
Lastly, we favour Reach Ten Holdings Bhd for its recurring income base (~90% of topline) and decent margins.
The key index staged a solid breakout and broke above the EMA60 with technical indicators showing positive signals. The MACD histogram continued to expand in the positive territory while the RSI is trending upward above 50.
Resistance is anticipated around 1,564-1,559 while support is located at 1,529–1,534. – May 8, 2025
