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 at the start of the week to halt the key index’s ascend amid a slowdown in fresh buying interest.
The market was generally morbid on news of rising cost around the globe but plantation stocks gained after palm oil prices surpassed the RM6,000/metric tonne level.
The broader market, however, saw increased profit taking and resulted in total losers beating gainers on more than a 2-to-1 ratio. The increased selling also resulted in traded volumes jumping 50% from last Friday.
The market is once again left with few impetuses as it was unable to build on its positive trend from the end of last week.
Its inability to follow through with the gains has also left it at the crossroads once more with the near-term outlook likely to remain subdued after yesterday’s meek closing on key global indices.
As it is, inflationary concerns continue to mount with talks of an impending recession ringing louder that would again leave market conditions guarded.
Therefore, the downside bias looks to continue over the near term with the 1,600 level being under threat again. If the level is breached, the next supports are at 1,595 and 1,588 points respectively.
On the flipside, the hurdles are at 1,608 and 1,618 points respectively.
Malacca Securities Research
The FBM KLCI slumped alongside regional peers on the back of broad-based selling pressure.
We expect investors to trade in a risk-off mood following the negative sentiment on Wall Street, especially the sell-down in technology stocks triggered by rising bond yields ahead of the US inflation data that may spill-over onto our local technology stocks.
Nevertheless, the daily COVID-19 cases which dropped below 10,000 in Malaysia should support economic recovery, thereby benefiting the recovery-themed stocks.
Commodities-wise, crude palm oil futures (FCPO) rose above RM6,000/metric tonne while crude oil price scaled back below US$100/barrel mark as investors anticipated a lower demand from China amid COVID-19 lockdowns.
The FBM KLCI remained well-supported above the 1,600 level despite a mild pullback. Technical indicators were positive as the Histogram remained above the zero line while the RSI hovered above 50.
The key index may climb towards the resistance at 1,620 while the support is set at 1,580. – April 12, 2022
