BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Bursa Malaysia stocks started the week on a weak note by giving up some of last week’s gains on quick profit taking activities that was partly in tandem with the pullback among regional indices.
Nevertheless, the FBM KLCI managed to hold on to the psychological 1,450 at the close.
Most Bursa indices were also lower with the Industrial Products and Services index emerging the biggest loser. Market breadth was expectedly negative with traded volumes little changed from last Friday.
We continue to see the near-term market conditions relatively indifferent with the key index likely to remain within a tight range for longer even as the interest rate upcycle may be ending and the threat of a severe global recession has receded.
As it is, there remains few impetuses for market players to nibble on and this could keep the key index range-bound with a slight downward bias for now.
Key global indices are also taking a breather from their recent gains and this could also keep the FBM KLCI on a lid for the time being.
While serving as a psychological level, the 1,450 level is still fragile and if it fails to hold, the supports are back again at the 1,445 and 1,440 levels. Meanwhile, the hurdles are at 1,456 and 1,460 points respectively.
Malacca Securities Research
The FBM KLCI has taken a break after a two-day rebound with selling pressure noticed within Nestle (M) Bhd and Petronas Chemicals Group Bhd.
Also, profit taking activities have emerged on Wall Street ahead of the jobs data which may indicate the direction of the US Federal Reserve’s rate policy going forward.
The market is looking at a pause for the interest rate this year and could be expecting a rate cut as soon as March next year.
Do note that the next FOMC (Federal Open Market Committee) meeting will be held on Dec 12-13.
Meanwhile, we believe the ongoing geopolitical tension in the Middle East may be dampening the overall market sentiment as well by limiting the upside potential on the global and local stocks markets.
On the commodity markets, Brent crude prices declined more than 1% to trade around US$78/barrel despite the additional production cuts by the OPEC+ members.
The FBM KLCI ended lower, consolidating after a two-day rebound. The technical readings on the key index are mixed with the MACD Histogram forming a rounding bottom formation while the RSI dips below the 50 level.
The resistance is pegged around 1,460-1,465 while the support is at 1,430-1,440. – Dec 5, 2023
