BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The FBM KLCI bucked the regional trend to close with minute gains after it clawed back all its intraday losses with buying support on many GLC (government-linked company) stocks like PETRONAS-related counters and Sime Darby Plantations Bhd.
However, market conditions were broadly negative as most other Bursa Malaysia indices closed in the red with the technology index the main losers.
Correspondingly, market breadth was decidedly negative on a ratio of more than 2-to-1 while traded volumes slipped below the 2 billion shares mark.
Although the key index tipped higher yesterday, the market’s undertone is looking precarious, affected by the conditions overseas that are still facing uncertainties over their respective economic outlook.
Therefore, the downside risk is still prevalent and could undo the recent gains on the FBM KLCI as sentiments are still looking delicate.
However, selling pressure appears to be mild among index-linked stocks for the time being as there are still pockets of buying support that could preserve much of the recent gains, particularly as the key index looks to hold on to the 1,500 level.
On the downside, the supports are at the 1,490-1,495 levels followed by the 1,480 level. The hurdles, on the other hand, are at the 1,506-1,510 levels and 1,518 points respectively.
Malacca Securities Research
The FBM KLCI eked out marginal gains, outperforming the negative regional markets as selling pressure subsided after the morning session sell-down.
Still, we expect global market sentiment to remain cautious on the back of persistent concerns over interest rate hikes going forward as the US Federal reserve stands firm on its hawkish stance.
On the local front, an increase in Malaysia’s July inflation rate may lead to another overnight policy rate (OPR) hike by Bank Negara Malaysia (BNM).
Commodities-wise, Brent crude oil price has surged above US$05/barrel mark while crude palm oil (CPO) traded above RM4,200/metric tonne.
The FBM KLCI ended marginally higher, staying above its daily EMA9 level. Technical indicators are recovering as MACD Histogram is making a rounding bottom with the RSI hovering above 50.
Resistance is envisaged at 1,530-1,550 while support is set along 1,450-1,465. – Aug 30, 2022
