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 made minor headway yesterday, extending its streak above the psychological 1,600 level at the close.
For most of the day, however, the key index was listless, hovering near the unchanged line amid few buying impetuses before ending the day higher.
Market breadth remained positive as most lower liners also made headway at the start of the week. Traded volumes, meanwhile, was a tad lower but remained above the 4.5 billion shares level.
We continue to think that the FBM KLCI remains toppish and as a result, there are fewer compelling buying opportunities after the key index has gained some 10% since the start of the year to emerge as among the main outperformer among regional equities year-to-date (YTD).
We also think the gains have reflected the key index’s positivity, thus further impetuses are needed to provide a sustainable lift to market to head higher.
Therefore, further gains could become more measured over the near-term due to the toppish conditions with the key index likely to embark on a sideway consolidation for some of the YTD gains to be digested.
Meanwhile, the unsettled global equity markets could also keep the key index range-bound for the time being with the targets remain at 1,608 points and 1,614 points respectively. The 1,600 level is the immediate support, followed by the 1,595 and 1,590 levels.
Malacca Securities Research
The FBMKLCI has snapped a three-day pullback in tandem with the FBM70 and FBM Small Cap indices marking fresh 52-week highs yesterday supported by the overall bullish environment.
Meanwhile, the US stock markets traded mixed for the session while awaiting the US inflation data (CPI, PPI) that will be released this week.
Also, the jobs and retail sales data in the US will be crucial for the US Federal Reserve to determine the interest rate directions going forward.
On the commodity markets, Brent crude managed to trade within the support zone around US$82-US$84/barrel while gold price maintained above the US$2,330/oz zone.
Elsewhere, the FCPO (crude palm oil futures) posted a rebound above the trendline, ending near the RM3,900/metric tonne level in view of potentially improved demand from China.
The FBM KLCI index ended marginally hovering above the 1,600 level. The technical readings on the key index were still positive with the MACD Histogram extending another positive bar while the RSI maintains above 50.
The resistance is envisaged around 1,615-1,620 while the support is set at 1,580-1,585. – May 14, 2024
