BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
The FBM KLCI managed to end last Friday with minute gains after starting the day on a losing note on thin volumes.
However, mild bargain hunting emerged on some of the index heavyweights in the afternoon session to trim the key index’s weekly losses.
Overall conditions, however, were still insipid with losers still beating gainers for the day as the lower liners and broader market shares continued to see profit taking ahead of the Christmas weekend. Traded volumes also retreated further.
The FBM KLCI is likely to mirror the performance of regional indices with sentiments buoyed by China’s re-opening plans even as the COVID-19 pandemic continues to take hold in the country.
Apart from the re-opening theme, there are still few noteworthy leads to boost the market with condition likely to stay mostly guarded for the time being, wary of the potentially more challenging economic environment in 2023.
Still, there is some measure of calmness over the near-term which should allow for the key index stocks to make some headway in what is also seen as mild window dressing activities amid thin traded volumes.
On the upside, the next hurdle is the 1,480 level, followed by the 1,490 level. The supports, on the other hand, are at 1,470 and 1,462 points respectively.
Malacca Securities Research
The FBM KLCI extended gains on Friday amid improving sentiment with foreign funds extending their buying activities (five-day net foreign buying stood at RM51.2 mil).
Also, the improvement on Wall Street overnight may spill over to the local front although upside might be capped amid worries over the impact of fresh COVID-19 outbreaks in China.
Commodities-wise, Brent crude surged above the US$83/barrel mark fuelled by tight US supplies while crude palm oil (CPO) price hovered above RM3,800/metric tonne.
We believe crude oil price could remain positive above the US$80/barrel support level in the near term given the production cut from OPEC+ and Russia.
The FBM KLCI climbed higher from the 1,460 support and closed above its daily EMA9 level. Technical indicators, however, were mixed as the MACD Histogram extended a negative bar while the RSI is hovering above 50.
The resistance is pegged along 1,500-1,510 while the support is set at 1,450-1,460. – Dec 27, 2022