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 lost more ground yesterday to slip to its lowest level in two months as profit taking and selling activities continued amid the still indifferent sentiments and regional weakness.
Selling was widespread among index-linked stocks and plantation stocks which emerged as the biggest losers. Market breadth was expectedly negative with many lower liners and broader market shares also losing ground.
The escalating selling, however, resulted in the day’s volume rising more than 40%. With the incessant selling, conditions on Bursa Malaysia are looking increasingly frail with the dour trend set to continue for the time being.
Buying interest is still insipid due to the vagaries in key overseas markets where slower economic conditions and threats of higher interest rates are still present that would keep market conditions guarded.
Back home, the ongoing results reporting season has provided few surprises with convincing leads for market players to nibble.
Still, the key index may be looking to break its downward trend as market conditions are nearing oversold. This could see the easing of selling which may also be a prelude for stocks to find some reprieve from the selling spree.
The supports are now at 1,460 points followed by the 1,455 level. The resistances, on the other hand, are at 1,470 and 1,480 points respectively.
Malacca Securities Research
The FBM KLCI continues to decline further below the 1,500 psychological level as foreign buying interest faded.
Given the flattish performance on Wall Street, we expect trading interest to stay muted on the local front, especially ahead of the Jackson Hole meeting whereby traders are speculating a more hawkish tone from the Fed.
However, we think some bargain hunting activities may emerge within the technology sector after the sell-down, at least for today.
Meanwhile, OPEC’s calling for a production cut should bode well for Brent oil price which is currently trading above the US$100/barrel and its SMA200.
The FBM KLCI fell for the sixth consecutive session and breached below its immediate support at 1,480. Technical indicators remained negative as the MACD Histogram has extended a negative bar while the RSI hovered below the 50 level.
Next support is located around 1,460 while the resistance is pegged along 1,500-1,530. – Aug 25, 2022
