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 continues to falter at the start of the final quarter of the year with the incessant selling among the key index stocks sending the key index below the 1,420-support level at the close.
Market conditions remain morbid in tune with the regional market weakness on renewed concerns over global growth.
The lower liners also followed suit, resulting in total losers more than twice the number of gaining stocks for the day with traded volumes little changed at around 3.0 billion shares.
As noted earlier, that the FBM KLCI is slipping below its successive support levels has left the market in a fragile mode again, heightening the threat of further near-term downsides as market players continue to retreat due to the increased downside pressure.
As it is, the country’s spate of weak economic data could see 3Q 2023 gross domestic product GDP performing worse than expected and this could further weight on the market’s performance.
This could also result in the key index surrendering more of the gains it attained in 3Q 2023 as the near-term outlook becomes more challenging.
With few signs of a rebound as yet, there could be more downside bias, particularly after the key index slipped below the 1,420 level. The supports are now pegged at 1,412 points and 1,407 points respectively. The immediate hurdle is at 1,420 points, followed by 1,425 points.
Malacca Securities Research
The FBM KLCI has extended its pullback below the 1,420 level amid broad-based profit taking activities but accompanied by a softer overall trading value.
Meanwhile, the US stock markets traded mixed led by the technology stocks despite an uptick in 10-year Treasury yield by hitting a 16-year high.
Also, we think the sentiment was affected by the US Manufacturing PMI data which came in below 50, indicating that the sector continues to contract.
On the local front, we believe the market may rebound on the back of bargain hunting activities.
Commodities-wise, Brent crude tumbled below US$93/barrel level amid rising US dollar while crude palm oil (CPO) prices traded below RM3,800/metric tonneT level.
The FBM KLCI ended lower within the current support zone of 1,400-1,420. Also, technical readings on the key index were negative with the MACD Histogram extended another negative bar while the RSI dropped below 30 into the oversold region.
The resistance is located around 1,450-1,460 while the support is located around 1,400-1,415. – Oct 3, 2023
