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 ended Monday marginally higher after a listless trading session with the key index largely on a holding pattern, awaiting for more catalyst to emerge which were also in tune with its regional peers’ mostly indifferent performances.
Rotational interest moved to construction stocks as they emerged as the day’s biggest movers but the broader market stocks ended lower to leave market breadth on the negative side. Traded volumes, however, picked up again to surpass the 3.0 billion shares mark.
Although the key index still managed to notch up some gains yesterday, market conditions are likely to stay indifferent ahead of this weekend’s state elections.
Consequently, the market is likely to dither as market players could just be nibbling on selected stocks for the time being.
This could slow further recoveries albeit the selling pressure is also remaining relatively benign and could leave the key index to drift for longer.
As it is, the market’s undertone is still positive in tune with the upsides in most global equities but the FBM KLCI’s recent gains are also deemed to be excessive, hence it appears the key index is undergoing a consolidation spell to allow the gains to be digested.
With the FBM KLCI set to stay range-bound, the resistances remain at the psychological 1,450 level and at 1,455 points while the main support is still at the 200-day moving average line of 1,437 points, followed by 1,433 points.
Malacca Securities Research
The local bourse ended relatively unchanged as investors are staying on the sidelines ahead of this weekend’s state elections.
We expect the muted trading sentiment to extend in the coming days on the back of the absence of fresh leads. The lower liners may also experience similar movement amid persisting uncertainties over the outcome of the six state elections.
Going forward, the key focus will be on the release of Malaysia’s industrial production data later today. Meanwhile, the improved market sentiment on Wall Street may see mild upsides permeating towards stocks across the local bourse.
Commodities-wise, Brent crude took a step back below US$86/barrel while crude palm oil (CPO) prices slipped below RM3,800/metric tonne.
The FBM KLCI ended flat, forming a doji candle to maintain above daily SMA200. Technical indicators remained mixed as the MACD Histogram extended another negative bar while the RSI treaded above 50.
The immediate resistances are located along 1,460-1,480 while the support is pegged around 1,400-1,420. – Aug 8, 2023
