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 was barely changed yesterday as it managed to end the day slightly higher after lingering in the negative territory for most of the trading session.
There was mild profit taking on recent gainers in the oil & gas (O&G), property and construction sector leaders, but banks were steadfast to help shore up the key index at the end of the session.
The lower liners were mixed with bouts of profit taking also prevalent which left losing stocks ahead of gainers for the day.
Despite the slightly wobbly market conditions, the equity market undertone remains upbeat with the economic re-opening theme still in play that would also provide the continuing near-term impetus.
At the same time, commodity stocks remain in favour due to their elevated selling prices that are showing few signs of easing as yet.
With the market’s positive undertone preserved, this should promote further near-term upsides with laggards and rotational plays coming to the fore.
Still, we think that the bouts of choppiness will remain as stock valuations are already toppish and that may slow the FBM KLCI’s ascend.
For now, the 1,610 level still looks to be a significant hurdle to clear which is followed by the 1,620 level. The supports remain at 1,600 and 1,590 points respectively.
Malacca Securities Research
The FBM KLCI showed marginal gains after flirting between gains and losses yesterday.
Given the foreign funds are still buying into our local equities, we expect the bullish momentum to sustain at least for the near term ahead of the tabling of Budget 2022 next week.
Also, we still expect recovery theme stocks to remain in focus with the re-opening of business activities in various segments following the ongoing vaccination programme.
Meanwhile, both crude palm oil (CPO) and crude oil prices extended their rally with the former surging above RM5,000 and the latter trading above US$85/barrel mark.
The FBM KLCI extended its gains for the third straight session and closed firmly above the 1,600 psychological level.
Technical indicators remained positive; the MACD Histogram has extended a green bar while the RSI hovered above the 50 level. The next resistance is located at 1,620 while the support is pegged along 1,580. – Oct 21, 2021
