BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
In tandem with the regional market upsides, the FBM KLCI extended its upward streak for a third day to also close near the psychological 1,600 level.
Asian equities were buoyed by hopes that the US Federal Reserve will begin tapering interest rates sooner following a string of weak economic data.
In the broader market, the lower liners sustained their mild ascend to help preserve the positive market breadth with traded volumes rising to nearly 4.5 billion shares for the day.
We think that the key index may become choppier as it approaches the 1,600 level with the technical indicators already toppish.
The level is seen as a formidable level to clear as this is also an area with many technical resistances to breach.
As such, we are in the view that a market pullback is in store for the gains over the past few weeks to be digested.
Even so, there are no signs of a consolidation as yet with the key index could still be making attempts to clear the level over the near-term, riding on the global equity market upsides as there remains firm buying strength among the index heavyweights.
The overnight gains on key global indices could also provide the impetus for further near-term gains. If the 1,600 level is cleared, the next hurdles are at the 1,602-1,605 levels, followed by 1,608 points with the supports pegged at 1,590 and 1,583 levels respectively.
Malacca Securities Research
The FBM KLCI has surged strongly for another session as buying interest was noted within the banking heavyweights and that most of the stocks in the broader market have marked fresh 52-week highs.
Meanwhile, Wall Street ended on a more positive note after last week’s non-farm payroll came in below expectations in April while unemployment ticked higher; this data suggested that the US economy may have cooled and the Fed’s rate cut may still be on the table for now.
On the commodity markets, Brent crude traded within the US$83-US$84/barrel support zone while gold price is located above US$2,320/oz. Meanwhile, CPO (crude palm oil) price rebounded above RM3,800/metric tonne.
The FBM KLCI index ended higher to a fresh 52-week high. The technical readings on the key index were positive with the MACD Histogram extending another positive bar while the RSI maintains above 50.
The resistance is envisaged around 1,610-1,615 while the support is set at 1,580-1,585. – May 7, 2024
