BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The was no reprieve for stocks on the FBM KLCI as the selling continued and sent it firmly below the 1,550 level to end the week.
While the heavyweights dithered, particularly banking and technology stocks, conditions were mixed elsewhere as many of the lower liners tipped higher as they continue to recover from their recent sell-down.
As a result, market breadth turned positive on the back of the mild bargain hunting activities.
Market conditions are likely to remain listless, deterred by the combination of fewer positive leads as well as lingering concerns over inflationary pressure and ongoing tight supplies.
As a result, market confidence remains frail and is unlikely to provide much leeway for the key index to make significant headway.
At the same time, the FBM KLCI has slipped below the psychological 1,550 level and in doing so, the near-term outlook is looking increasingly challenging.
As there are still few impetuses available, the downside bias also remains and could result in the key index drifting further.
On the downside, the supports remain at the 1,530 level followed by the 1,525 level. The hurdles, on the other hand, are at 1,540 and 1,547 points respectively.
Malacca Securities Research
The FBM KLCI slid for the third straight session as investors took further profits in in the banking heavyweights while picking up shares in technology and energy sectors.
We believe the local bourse is poised for a mild turnaround supported by bargain hunting activities especially in commodity and technology stocks given the flat overnight Wall Street movements.
Nevertheless, downside risks include global inflation and the prolong Russia-Ukraine conflicts.
Commodities-wise, Brent crude price settled just below the US$120/barrel mark as concern over supply-demand imbalance remained in focus following abating China’s zero-COVID strategy.
The FBM KLCI remained below its EMA9 level as it declines further before the weekend break. Technical indicators remained mixed as the MACD Histogram has extended a positive bar while the RSI hovered below the 50 level.
Support is pegged at 1,530 followed by 1,500, while resistance is set around 1,570-1,580. – June 7, 2022
