BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Market conditions turned softer yesterday with the FBM KLCI dipping below the 1,420 support due to the increased selling in banking and energy stocks – the former spooked by renewed concerns over the US banking sector.
The selling was widespread as foreign funds increased their disposals with the broader market shares also losing further ground, causing market breadth to remain negative.
The day’s total traded volumes were little changed from a day earlier. Following yesterday’s pullback, the FBM KLCI is left at the crossroads again as the recent base building exercise has become undone.
The consolidation has also left the key index tethering at its technical support level and with the downside bias still prevalent, there could be further near-term weakness as the buying interest is still weak.
As it is, the prevailing global headwinds are casting aside some of the improved corporate earnings and is sending many key global indices lower.
This trend is likely to permeate to stocks on Bursa Malaysia and could further leave market conditions morbid over the near term.
Consequently, the downsides could prevail and if the immediate support at the 1,410-1,413 level is breached, the supports are lowered to 1,406 points and the psychological 1,400 level respectively. The hurdles, meanwhile, are at 1,420 points and 1,425 points respectively.
Malacca Securities Research
The FBM KLCI surrendered its gains in the previous session amid heavy sell-down in selected banking and energy heavyweights; the former was affected by renewed concerns over the US banking crisis.
Similarly, fears over the potential recession resurfaced on the global front as investors await the US Federal Reserve interest rate decision next week.
Hence, the cautious sentiment on the local front may persist at least for the near term. Commodities-wise, Brent crude price extended its downtrend move towards US$77/barrel, crude palm oil (CPO) price hovered above RM3,550/metric tonne while gold price stayed below USD2,000/ounce.
The FBM KLCI reversed its gains to close below the 1,420 level. Technical indicators remained negative as the MACD Histogram extended a negative bar while the RSI hovered below 50.
Investors may monitor its support at 1,410, followed by 1,400 while the resistance is pegged along 1,440-1,450. – April 27, 2023
