BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
With the market devoid of new leads, the FBM KLCI retreated yesterday to start the week on a losing note albeit the losses were relatively superficial and the key index remained above the 1,610 level at the close.
While the key index dithered, the lower liners sustained their gains on continuing bargain hunting activities that also allowed market breadth to stay on the positive side.
The gains in the lower liners also saw the traded volumes picking up to nearly 6 billion shares for the day.
We see the key index remaining mostly range-bound as the wait-and-see stance is likely to dominate sentiments for the time being.
As it is, the US Federal Reserve will decide on the US interest rate tomorrow. Although the rates are set to remain unchanged, market players will be more interested in the cues on its direction for the foreseeable future.
In addition, inflation watch will continue following the removal of domestic diesel subsidies albeit the direct impact is likely to be limited as targeted subsidies are still available.
With the key index to stay largely range-bound, the supports remain at 1,610 and the psychological 1,600 points respectively. Meanwhile, the 1,620 level is the immediate resistance, followed by the recent high of 1,632 points.
Malacca Securities Research
As the diesel reform went live, the FBM KLCI traded lower as profit taking activities emerged within the heavyweights while traders were focusing on small cap stocks within the technology, utilities and construction members like Kelington Group Bhd, Ranhill Utilities Bhd and WCT Holdings Bhd.
Over in the US, sentiment turned mildly positive heading into the two-day Federal Open Market Committee (FOMC) meeting where traders await the meeting’s outcome as well as the CPI (Consumer Price Index) and PPI (Producer Price Index) that will be released over the next two days.
Based on Bloomberg, it is widely anticipated that the Fed will keep the interest rate unchanged in this FOMC meeting.
On the commodity markets, Brent crude rebounded into the range of US$81-US$84/barrel.
The FBM KLCI index ended lower and pulled back below the 1,615 level. The technical readings on the key index were positive with the MACD Histogram forming a rounding bottom formation while the RSI maintains above 50.
The resistance is envisaged around 1,630-1,635 while the support is set at 1,595-1,600. – June 11, 2024
