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 was still on a losing pace as it started the holidays-shortened week on a subdued note, giving up all its intraday gains to end the session at the 1,450 support level amid the persistent lack of leads and buying interest.

In the same vein, conditions in the broader market were also lacklustre due to the on-going year-end holidays that saw total trades thinned further and remaining below 3.0 billion shares for the day. Expectedly, market breadth was on the negative side.

Looking ahead, we expect market conditions to remain uninteresting due to the prevailing lack of buying interest.

Despite the pullback over the past few sessions, there are still few signs of a reversal as yet while the market’s indifference could linger to leave the key index to lose further traction over the near term.

This comes after the key index failed to maintain its successive support levels as the selling/profit taking remains prevalent.

At the same time, most market players are still away and this leaves little buying support. Therefore, the psychological 1,450 level remains at risk of seeing a fresh breach albeit we think that there could some mild attempts for the level to be preserved.

The overnight gains on Wall Street may help to arrest the falls but upsides could also be difficult to come by due to the lack of buying interest. The supports are now at the 1,448 and 1,445 levels while the resistances are at the 1,452-1,455 levels, followed by 1,461 points.

Malacca Securities Research

The FBM KLCI extended its consolidation phase with further profit taking activities emerging within the index heavyweights.

However, the US stock markets continued to charge higher led by the technology sector in anticipation of at least three rate cuts by the US Federal Reserves in 2024.

This is in line with our view that given the US GDP (gross domestic product) is still growing in 3Q 2023.

With the inflation data namely the Consumer Price Index (CPI), Producer Price Index (PPI) and Personal Consumption Expenditures Price Index (PCE) also coming in within expectations last month, we believe the US Fed will be staying less hawkish for the near term.

Meanwhile, closer to home, we remain optimistic in the final trading week of the year that window dressing activities may emerge to push the FBM KLCI higher. On the commodity markets, Brent crude prices traded higher above the US$80/barrel mark.

The FBM KLCI ended marginally lower, consolidating for the fourth session. The technical readings on the key index were however negative with the MACD Histogram having turned negative while the RSI dips below the 50 level.

The resistance is envisaged around 1,470-1,480 while the support is set at 1,440-1,450. – Dec 27, 2023

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