BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
The FBM KLCI continues to make firm headway, taking out successive resistance points amid the return of bargain hunting that enabled the key index close at its highest level since February this year on expectations that global interest rates have peaked.
Similarly, the broader market was buoyed by the ongoing market positivity that allowed total gainers to beat losing stocks on a ratio of more than 2-to-1.
Expectedly, traded volumes also improved with total trades amounting to nearly 3.8 billion shares.
Although the market undertone has improved amid the reduced odds of a severe downturn in the global economy, the recent strong gains may have been overdone and could prompt some near-term profit taking.
As it is, the key index is resting at its new “make or break” level at 1,465 points that may not be convincingly cleared immediately given that the market conditions are approaching overbought.
This could slow its near-term ascend following the knee jerk reaction to the US Federal Reserve’s recent interest rate decision and both the global and Malaysian economies are not totally out of the woods as yet.
On the upside, the resistances are at the 1,465-1,467 levels, followed by the 1,472 level. The supports, on the other hand, are at 1,459 and 1,452 points respectively.
Malacca Securities Research
The FBM KLCI ended on a positive note for the third session, rising more than 2% from last week’s low.
Also, we noticed that the ringgit trend has strengthened significantly from RM4.7925/US$1 to RM4.6330/US$1 as foreign investors scoop up local equities.
However, with the Wall Street ended slightly flattish following the run up by more than 5%-7% across the three major benchmark indices – coupled with the rising 10-year US Treasury yield ahead of the Fed speech this week – the overall market could be taking a breather on the back of profit taking activities.
On the commodity markets, Brent crude prices had a volatile move, trading off the high of US$86.41/barrel despite the ongoing geopolitical tension with Saudi Arabia and Russia confirming production cuts towards end-2023.
The FBM KLCI ended higher, extending from the flag formation breakout. The technical readings on the key index are positive with the MACD Histogram extending a positive bar while the RSI shot above 50.
The resistance is pegged around 1,470-1,480 while the support is at 1,440-1,450. – Nov 7, 2023