BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
It was a tale of two halves with the key index making up ground in the morning session but only to shed all its intraday gains and more in the afternoon session as profit taking set in, sending the key index to its lowest level in a week.
Similarly, the lower liners and broader market shares also succumbed to renewed profit taking to start the week amid the lack of fresh leads.
As a result, market breadth turned negative again.
Although market sentiments remain mostly indifferent due to the lack of leads and the sustained cautiousness over the state of the economy, the market could be angling for a quick rebound after yesterday’s sell-down.
The overnight bounce in key global indices should provide some impetus for Malaysian equities to also mount a recovery.
For now, however, there are still few buying catalysts, and this could limit the key index’s potential upsides with the 1,550 level to continue serving as the main near-term hurdle.
In any case, the rebound could allow the key index to find support near the 1,550 psychological level where it can aim to build up a base. Above the 1,550 level, the other resistances are at 1,558 and 1,563 points respectively.
The supports, meanwhile, are at the 1,538-1,540 levels and at 1,532 points.
Malacca Securities Research
Steep sell-off on plantation heavyweights sent the FBM KLCI into the negative territory amid mixed regional performances.
Investors are likely to trade cautiously at the start of the session prior to the release of Malaysia’s inflation rate tomorrow.
Nevertheless, we believe bargain hunting activities could kick in as concerns over inflation may have been priced in with traders focusing in the recovery-themed sectors.
Also, we believe buying interest may emerge among technology stocks in line with the rebound in Wall Street.
Commodities-wise, Brent crude price hovered around the US$113/barrel mark while crude palm oil (CPO) is trading around RM6,200/metric tonne.
The FBM KLCI extended its losing streak below the daily EMA9 level for the third straight session. Technical indicators remained mixed as the MACD Histogram has extended a positive bar while the RSI hovered below the 50 level.
Support is set at 1,500-1,530 while resistance is pegged around 1,570-1,580. – May 24, 2022
