BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
There was no let off in the selling on Bursa Malaysia with total losers some four times more than winning stocks on Thursday, the bulk of which were on the FBM ACE Market listed stocks as their steep sell-down extends for a third day.
Selling activity remained hefty with over 6.0 billion shares traded for the day, some 17% more than a day earlier.
On the FBM KLCI, however, selling was less pronounced, hence allowing for the key index to close near the 1,480-support level.
The FBM KLCI’s near-term outlook is becoming more cautious with the intense sell-off of FBM ACE market stocks leaving sentiments among the key index constituents more cautious.
This could extend the profit taking among the recent big gainers on the key index and sending it back below the 1,480-support level where it is now tethering.
There is increased wariness over the key index’s direction due to the recent market malaise and even if the selling subsides, it is likely that the market environment will become quieter as many market players could opt to stay on the sidelines until there is more clarity on its direction.
In the meantime, the 1,480 level looks precarious and if it gives way, the supports are lowered to 1,476 points and 1,467 points respectively. The resistances, on the other hand, are at the 1,483-1,487 levels, followed by the 1,490 level.
Malacca Securities Research
The FBM KLCI ended lower for the third session given the market sentiment was affected by margin calls in small cap and lower liners; the FBM Small cap dived 2.07%, while FBM ACE plunged 5.2%.
However, the US stock markets rebounded following the release of results from TSMC (Taiwan Semiconductor Manufacturing Company Ltd) where the outlook is positive with a projection of more than 20% growth amid booming demand for high-end chips used in AI application.
This prompted the jump in Nvidia, AMD, Broadcom and others. Moreover, Apple was upgraded to “buy” from “hold” by BofA (Bank of America).
We believe the overall sentiment in the US may spill over to stocks on the local front after the recent sell-offs.
On the commodity markets, Brent crude price traded slightly higher around US$79/barrel as inventories in the US fell more-than-expected.
The FBM KLCI ended lower for the third consecutive days. The technical readings on the key index were however mixed with the MACD Histogram extending another negative bar while the RSI maintains above the 50 level.
The resistance is envisaged around 1,510-1,520 while the support is set at 1,460-1,470. – Jan 19, 2024
