BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
The FBM KLCI headed south again at the start of the week, extending its downward streak for the fourth consecutive trading session.
Market conditions were still lacklustre amid the weaker ringgit that saw foreign funds continuing their disposal of Malaysian equities.
The selling also spread to lower liners and broader market shares after they stayed steady in the past few sessions.
At the same time, the sell-down was also widespread as losers overwhelmed gainers on a 4-to-1 ratio.
Conditions on Bursa Malaysia are still in doubt, undermined by persistent concerns over the state of the global economy as well as rising recession risk and monetary tightening outlook.
As such, there is no change to the near-term market outlook with the downside bias still prevalent despite the oversold technical indicators.
As it is, there are still few signs of any reprieve as yet with foreign fund likely to sustain their selling due to the weakening ringgit with cumulative selling nearing the RM1 bil mark from the start of the month.
The FBM KLCI may now look to re-test the year low at 1,408 points and if that fails to hold, the next support is the psychological 1,400 points. The hurdles, meanwhile, are at 1,420 and 1,430 points respectively.
Malacca Securities Research
The FBM KLCI tumbled as the plantation, telecommunication and banking heavyweights continued their negative tone amid the persisted bearish sentiment on the global front.
We observed that the five-day foreign net selling stood at RM753.9 mil.
With Wall Street sliding deeper into a bear market, we believe the local bourse is likely to witness heightened volatility on the back of worries over the global economic downturn.
Commodities-wise, both the Brent crude and crude palm oil (CPO) price extended a downtrend move, hovering around US$84/barrel and RM3,500/metric tonne respectively. Meanwhile, gold price trended lower, trading around US$1,620/oz as investors amass the greenback.
The FBM KLCI booked a fourth-session decline as the key index moved closer to its 52-week low at 1,410. Technical indicators remained weak as the MACD Histogram extended a negative bar while the RSI went below the oversold 30 level.
The next support is located at 1,400-1,410 while resistance is set along 1,450-1,460. – Sept 27, 2022