BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Profit taking emerged on Friday ahead of the long weekend but the key index managed to stay above the 1,610 at the close after it lingered in the negative territory for the entire session.
Buying interest was also thinner overall as traded volumes slipped some 12.0% for the day due to fewer noteworthy leads for market players to follow.
Similarly, the broader market stocks were also mostly lower with the telecommunications and media sector being the big losers.
We still think that key index will be mostly range-bound as it attempts to build up a base around the 1,600 level that could help to preserve much of its YTD (year-to-date) gains.
As it is, market conditions are still devoid of new catalyst with market players still waiting for more indications of interest rate cuts that could provide a big boost to market sentiments.
Although we see the key index remaining range-0bound, gyrations are still in the offing with the key index still in a state of fluidity and may still surrender the 1,610 level in a continuation of the mild profit taking actions amid the lack of new leads.
For now, the 1,605 level will serve as the immediate support before the psychological 1,600 support level comes into play. On the flipside, the resistances are at 1,615 and 1,620 points respectively.
Malacca Securities Research
Both the FBM 70 and FBM Small Cap declined marginally but are still hovering along the all-time high zone prior to the long weekend holiday.
Meanwhile, the US stock markets ended mixed with both S&P500 and Nasdaq closing at record highs while the Dow lagged.
Investors will be watching the upcoming CPI (consumer pt=rice index) and PPI (purchase price index) data as that may dictate the interest rate directions taken by the US Federal Reserve.
We believe the inflationary pressures have been on the declining trend and that should allow the Fed to potentially lower the interest rate in 2H 2024.
On the commodity markets, Brent crude had declined for the past two trading days after hitting the resistance around US$88/barrel while gold traded above US$2,360/oz. Meanwhile, CPO (crude palm oil) could be forming a rounding bottom and a flag formation by awaiting a breakout above RM4,100/metric tonne.
The FBM KLCI index ended lower towards the 1,611 level. However, the technical readings on the key index were positive with the MACD histogram forming another positive bars while the RSI surged above 50.
The resistance is envisaged around 1,626-1,631 while the support is set at 1,591-1,596. – July 9, 2024
