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 managed to end the day with minute gains after a volatile session where the key index oscillated between the positive and negative territories amid a directionless trading environment with the war in Eastern Europe still pre-occupying market sentiments.
However, plantation stocks continue to gain ground on higher palm oil prices that also helped to cushion the market from the weakness in the broader market as there were more losers than gainers for the day.
Despite the on-going uncertainties in Europe’s eastern front, Malaysian equities are poised to tip higher over the near term as market sentiments could be buoyed by overnight gains on major global equities indices that are casting aside the escalating Russia-Ukraine conflict as well as the US Federal Reserve’s reiteration of its interest rate hike plans.
Rotational plays are likely to continue with plantations stocks to dominate trading again on the back of record palm prices while energy stocks could also make a comeback as oil prices surged to a new seven-year high.
The upsides should send the key index comfortably back above the 1,600 level with the ensuing target at the 1,608-1,610 levels. On the downside, the supports are still at 1,590 and 1,585 points respectively.
Malacca Securities Research
The FBM KLCI chalked up marginal gains led by the energy, plantation and metal-related index components amid soaring commodity prices.
We believe the key index is likely to hold its gains on the back of (i) the sharp rebound on Wall Street overnight following the US Federal Reserve supporting smaller rate hikes going forward; (ii) surging crude oil prices after a global agreement to release crude reserves failed to calm fears over supply disruptions; and (iii) likelihood for Bank Negara Malaysia (BNM) to hold the interest rate until end-June.
Brent crude oil price has jumped above the US$112/barrel mark while crude palm oil (CPO) prices are trading above RM6,600/metric tonne.
The FBM KLCI continued to hold above the daily EMA9 level amid increasing trading volume. Technical indicators remained positive as the MACD Histogram extended a positive bar while the RSI hovered above the 50 level.
Support is set at 1,580 followed by 1,570 while the resistance is pegged around 1,615. – March 3, 2022
