What to expect on Bursa Malaysia this Wednesday

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 mounted a decent rebound yesterday, rising in tandem with the gains on Wall Street a day earlier and boosted by renewed bargain hunting on some of the beaten down sector leaders, particularly from foreign funds.

In the process, the key index also inched back above the 1,460 level to close near its nine-month high again.

The positivity also extended to the broader market and allowing for market breadth to turn positive.

Once again, yesterday’s rebound was welcomed to break the down-cycle and helped to restore some market confidence.

However, it remains to be seen if the rebound is sustainable after the US Federal Reserve hinted that interest rates could stay elevated for longer albeit there are also few inklings of further rate hikes at this junction.

At the same time, the key index may still find its recent high of 1,465 level a formidable level to clear as it has become the next “make or break” level and this could continue to keep it in check.

Still, any pullback may be mild as the FBM KLCI could attempt to stay above the 1,460 level for the time being amid the revival of buying support from foreign funds. Below the 1,460 level, the other support is at 1,455 while the other resistance is at 1,473 points.

Malacca Securities Research

The FBM KLCI closed higher with a flag formation breakout amid a resumption of buying support.

However, Wall Street ended marginally lower following the FOMC (Federal Open Market Committee) meeting minutes which suggest that the Fed may proceed carefully on the interest rate directions and be in a “wait-and-see” mode.

Also, profit-taking activities emerged post-market on Nvidia following the release of its results; earnings came in above estimates and we expect the profit-taking action to spill over towards stocks on the local front.

We now expect traders to focus their attention on the upcoming reporting season after last week’s release of the Malaysian GDP (gross domestic product) which grew by 3.3% in 3Q 2023.

On the commodity markets, Brent crude prices traded above US$82/barrel following the FOMC meeting minutes.

The FBM KLCI ended higher, forming another flag formation breakout. The technical readings on the key index are positive with the MACD Histogram extending a positive bar while the RSI has maintained above 50.

The resistance is pegged around 1,470-1,480 while the support is at 1,440-1,455. – Nov 22, 2023

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