BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
There were more upsides among Malaysian equities yesterday as the key index regained traction in tandem with the rising positivity among global equities that helped to renewed bargain hunting activities.
Beaten down technology stocks were among the big movers with the market also encouraged by Malaysia’s record total trade in June.
As a result, gaining stocks beat losers on a 2-to-1 ratio with a pick-up in traded volumes to over the 2.0 billion mark again.
The near-term positivity is set to continue with Malaysian equities to mirror the outperformance of global equities and to temporarily cast aside the prevailing economic challenges to mount a long-awaited rebound from oversold conditions.
Mild bargain hunting is likely to continue on some of laggards but with investor interest yet to pick up in a meaningful way, further upsides may still be modest.
Despite the improved market undertone, there may also be quick profit taking on some of yesterday’s gainers and this could see tentativeness emerging in the early parts of the session before the upsides resume later.
On the upside, the key index could target the 1,440 level and if cleared, the next hurdle will be the psychological 1,450 level. The supports, on the other hand, are at 1,430 and 1,420 points respectively.
Malacca Securities Research
The FBM KLCI climbed in line with the broadly-positive sentiment from the regional markets.
Investors should see a positive-bias trading tone on the local bourse following the extension of rebound on Wall Street, supported by bargain hunting activities on significantly oversold stocks over the past few weeks.
For commodities, the Brent crude is still trading above its SMA200 and the US$106-US$107/barrel level while the crude palm oil (CPO) price was little changed around RM3,900/metric tonne.
Nevertheless, we foresee the CPO price to remain under pressure for 2H 2022 after the Indonesian Government ramped up export.
The FBM KLCI rallied with the key index remaining above its daily EMA9. Technical indicators are on a recovering tone. The MACD Indicator has extended another positive bar while the RSI is recovering towards 50.
Resistance is located at 1,460-1,480 while the support is set along 1400-1,420. – July 21, 2022
