BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The key index retreated yesterday in what was seen as quick profit taking action, slipping back below the 1,600 level.
Buying interest was mostly subdued due to the lack of new leads but plantation and energy stocks jumped after commodity prices recovered.
The broader market and lower liners, however, remained on the upside amid a rise in trading activities that also helped market breadth to stay positive while traded volumes climbed further.
Although there are few domestic leads, global equity market conditions are staying relatively upbeat that would also provide some support to Malaysian equities over the near term.
The rebound in energy and plantation stocks look to continue amid their recovering prices that should also lead the key index higher over the near term.
This could see the key index to not only re-test the 1,600 level but also to climb back above the level amid the continuing rotational buying interest on laggards in the above sectors.
Mild bouts of bargain hunting could also emerge on other key index constituents due to the improving market undertone.
Above the 1,600 level, the targets are between the 1,602 and 1,606 levels, followed by the recent high of 1,618 points. The supports, meanwhile, are at 1,595 and 1,590 points respectively.
Malacca Securities Research
The FBM KLCI underperformed its regional peers as the key index traded below 1,600 amid profit taking activities within selected heavyweights.
We expect the market to remain volatile over the near term while investors continue to monitor the potential move of Western countries imposing more sanctions against Russia.
Nevertheless, downside risk should be cushioned by continuous foreign inflows. Meanwhile, the European Union’s (EU) acceptance of Malaysia’s COVID-19 vaccination may bode well for the aviation sector moving forward.
Commodities-wise, both crude oil and crude palm oil (CPO) prices trended higher as global demand remained strong.
The FBM KLCI slipped below the 1,600 level but managed to hold above the daily EMA9. Technical indicators turned positive as the Histogram is gradually recovering while the RSI is hovering above 50.
Resistance is pegged around 1,600-1,620 while the support is set at 1,580. – April 5, 2022
