BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian stocks regained traction yesterday as it rose to its highest level in nearly two weeks with the FBM KLCI also climbing back near to the 1,430 level.
The recovery was in tandem with the on-going calmness in global equities with bargain hunting emerging on energy stocks as oil prices regained the US$100/barrel mark.
Lower liners and broader market shares also rose with traded volumes on the rise again while market breadth turned to the positive side.
The near-term outlook has improved following yesterday’s recovery and the key index will be attempting to build on the gains it attained.
The continuing positivity should allow the key index to gain further traction as the FBM KLCI looks to break its downward streak that started in May and to also mount a sustainable recovery.
This may allow the market to temporarily cast aside the prevailing economic concerns but depending on the level of fresh buying interest, the upsides could still be tempered by quick profit taking at first before the key index makes some headway later in the session.
The FBM KLCI’s next targets are at the 1,438-1,440 levels followed by the 1,442 level. The supports, on the other hand, are at 1,425 and 1,420 points respectively.
Malacca Securities Research
The FBM KLCI managed to rebound and recouped its losses from the past week, riding high on upbeat performances from the regional markets and Wall Street overnight.
With foreign investors turning net buyers (five-day net foreign fund inflow: RM53.7 mil), traders may expect a mild extension of the rebound on the severely oversold local equities market.
Nevertheless, gains might be capped by challenging business operating environment on the back of heightened inflation pressure.
On the commodity markets, Brent crude price rose above the US$106/barrel mark while crude palm oil (CPO) traded above RM4,000/metric tonne.
The FBM KLCI crossed above its daily EMA9 level. Technical indicators were mixed as the MACD Histogram extended a positive bar while the RSI hovered below 50.
Should the key index be able to breach above the 1,430 level, the next resistance is located at 1,450-1,460 while support is pegged along 1,380-1,400. – July 19, 2022
