BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
The FBM KLCI mounted a firm follow-through uptrend from last Friday as bargain hunting activities picked up pace amid the deeply oversold conditions.
The gains also allowed the key index to bounce back above the 1,380 level with heavyweight plantation, industrial products and healthcare stocks leading the gains.
Expectedly, the broader market stocks also sustained their gains to allow market breadth to stay positive. Traded volumes were also decent with some 3 billion shares traded yesterday.
The rebound is welcomed to break the dour trend that has engulfed Bursa Malaysia over the past few weeks that also left it oversold and tethering at its lowest level in some eight months.
With the recent rebound, the market undertone is showing improved signs that may prolong the key index’s upsides as it also looks to recover further from its oversold conditions even as there are few noteworthy domestic leads.
Although the ongoing upsides among key global and regional equities have largely been a non-event to Malaysian equities, their positivity may still generate some near-term impetus for the recovery to sustain after the 1,380 turned-support level has been cleared.
The key index could now be targeting the 1,390 and 1,395 levels over the near term while the immediate support is at 1,382 level.
Malacca Securities Research
The FBM KLCI rallied along with the regional markets amid the inflow of foreign funds as bargain hunting activities emerged within the banking heavyweights.
We believe investors may be on the look-out for the US consumer price index (CPI) data as well as outcome of the Federal Open Market Committee (FOMC) meeting later this week.
With the consensus expecting a declining CPI and the US Federal Reserve keeping the interest rate unchanged at 5.00%-5.25% for now, there should be upside potential to the stock markets.
However, the upside on the FBM KLCI could be capped by sentiment of the upcoming six states election.
Commodities-wise, Brent crude price tumbled towards US$72/barrel while crude palm oil (CPO) price hovered just below RM3,350/metric tonne.
The FBM KLCI extended its gains to close above its daily EMA9 level. Technical indicators turned fairly positive as the MACD Histogram turned into a positive bar while the RSI climbed above the oversold 30 level.
Resistance is pegged along 1,400-1,440 while the support is set around 1,370. – June 13, 2023