BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Although the key index continues to head south yesterday, spooked by the emergence of the Omicron variant, it managed to end the day well off its low as bargain hunting activities emerged on some of the beaten down stocks.
There was also a flurry of activities with traded volumes jumping by 25% to over 6 billion shares for the day albeit losers still twice the number of gainers as many of the lower liners and broader market shares ended the day on a negative note.
After an extended selling streak, the market is ripe for a rebound from its oversold streak.
Even as the Omicron variant concerns have not abated and will continue to dictate market conditions, near term bargain hunting could be in store as some bellwethers’ valuation are looking compelling.
Therefore, the bouts of fresh buying could sustain for now to provide the impetus for the key index to make a recovery.
However, there could also be bouts of volatility as we also think that there could be quick profit taking actions that may slow the key index’s ascend.
Nevertheless, near-term positivity is likely to prevail as the key index looks to adjust from oversold that may also allow it to retest the 1,520 level.
In the interim, there is a resistance at the 1,517 level while the 1,500 level is still the major support for now followed by the 1,490 level.
Malacca Securities Research
The FBM KLCI started the week on a negative note in tandem with the sell-down on regional bourses amid the Omicron variant fears.
However, we believe the overnight Wall Street positive performance may provide some buying support on the local equities as we think the selling pressure is overdone at least for the near term, contributing to oversold signals and hammer candles on most of the stocks.
Also, some economists claimed that the economic impact stemmed from COVID-19 Omicron variant will be less severe than that in 2020.
On the commodity markets, a mild rebound was noticed in both crude palm oil (CPO) and crude oil price.
The FBM KLCI sank for the fifth trading session as the key index remained below its daily EMA9 level. Technical indicators remained negative as the MACD Histogram has extended a negative bar while the RSI hovered below the 50 level.
The support level is located 1,500 while the resistance is pegged along 1,535-1,560. – Nov 30, 2021
