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 was virtually unchanged again at the start of the week, continuing its indifferent trend from the previous week.
There were few domestic leads as market players monitor the release of corporate results albeit regional markets were firmer on China’s stimulus measures.
Still, much of the market’s activities were on the broader market as traded volumes spiked up to nearly 4.5 billion shares with the FBM Small Cap index making headway. The increased market interest also allowed market breadth to remain positive.
With the results reporting season approaches its conclusion, much of the market’s interest will be on the remaining results to be reported.
However, the key index could still be on a range-bound trend is it looks to fortify its position around the 1,450 levels for the time being, following its strong gains since the start of 2H 2023.
Market players would still be assessing the prospects on the index heavyweights for the rest of the year and beyond as the recent gains has left the valuation of many of these stocks near their fair values, thereby limiting their near-term upside potential.
With selling pressure also relatively benign, the key index could also find some support and extending its sideway trend within the 1,440 and 1,450 levels for now. The other support and resistance levels are at 1,437 points which is the 200-day moving average line and at the 1,455 level respectively.
Malacca Securities Research
The FBM KLCI traded in a narrow range for the past two trading days while investors were focusing on the small cap stocks.
Meanwhile, we believe the buying interest may spill over to our stock markets given the positive performance on Wall Street overnight.
Also, with the special financial hub news being announced last week, we expect the trading interest to stay vibrant at least for the near term.
Nevertheless, traders should take note of the several key economic data this week that may shape the tone of the US Federal Reserve going forward.
Commodities-wise, Brent crude steadied above US$84/barrel while crude palm oil (CPO) prices continued to stay above RM3,900/metric tonne.
The FBM KLCI formed another narrow candle above the SMA200 level. The technical readings on the key index are still positive bias with the MACD Histogram forming a rounding bottom pattern while the RSI is hovering above 50.
The FBM KLCI’s resistance is envisaged around 1,450-1,460 while the support is located around 1,430-1,435. – Aug 29, 2023
