What to expect on Bursa Malaysia this Thursday

BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:

Inter-Pacific Research

Malaysian equities took a dive yesterday in tandem with the steep pull-back in global equities that were spooked by prospects of further interest rate hikes as inflation remains elevated.

The weaker sentiments prompted further selling on the heavyweights by sending the key index to its lowest level in three weeks.

Similarly, lower liners and broader market shares also tumbled amid increased selling that resulted in total losers more-than-twice the number of gainers for the day.

We see the near-term market conditions as remaining subdued ahead of the long weekend as investors are likely to stay cautious for the time being.

However, selling pressure may also look to ebb after yesterday’s steep falls and may even give rise to some mild bargain hunting opportunities as traders pick-up some of the recent big losers.

This could help to prevent steeper falls even as there is still downside risk as most market players are likely to retain their wait-and-see stance until there is further market clarity.

For now, there will be support at the 1,460 and the 1,450 levels with minor resistance at 1,470 points, followed by the 1,475-1,480 levels.

Malacca Securities Research

The FBM KLCI witnessed another wipe-out along with its regional peers on the back of inflation-induced rout.

We believe the market should remain volatile at least until the Federal Open Market Committee (FOMC) meeting which will be held next week.

This is given investors will be waiting for more clarity from the Fed’s chairman Jerome Powell on the interest rate decision; currently the market is pricing in a 75-basis point rate hike.

Meanwhile, geo-political uncertainties could be capping the upside reward at this juncture. Commodities-wise, Brent crude price ticked up to the US$94/barrel mark while crude palm oil (CPO) traded above RM3,800/metric tonne.

The FBM KLCI tumbled below its immediate support yesterday at 1,485. Technical indicators remained negative as the MACD Histogram extended a negative bar while the RSI hovered below the 50 level.

The next support is located at 1,465 followed by the 52-week low around 1,410 while resistance is pegged along 1,480-1,500. – Sept 15, 2022

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