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 ended yesterday virtually unchanged but surrendered its intraday gains despite lingering at the psychological 1,600 level for much of the day.
For most part, buying interest remained relatively benign due to the lack of fresh catalyst. However, the broader market was more sanguine as pockets of fresh buying were sustained to help market breadth to stay positive.
There was also a noticeable pick-up in traded volumes which increased nearly 50% to 5.4 billion shares for the day.
Although the key index ended the day marginally lower, we think that the recovery phase is still intact as the consolidation trend looks to have run its course.
Consequently, the key index would be attempting to find more near-term stability around the 1,600 level amid the easing selling pressure.
Nevertheless, fresh buying interest may still be benign in the absence of new compelling buying opportunities. There could also be nibbling on some of the recent big losers that would enable the key index to find some reprieve for the time being.
We also see the market remaining subdued with the hurdle above the 1,600 level located at 1,605 points while the supports remain at 1,595 and 1,590 points respectively.
Malacca Securities Research
The FBM KLCI ended marginally lower amid selling pressure within selected telco heavyweights while the FBM70 and FBM Small Cap rebounded strongly.
Over in the US, sentiment remained positive with the S&P500 and Nasdaq closing at all-time-high positions after Jerome Powell commented that inflation is well on track towards the US Federal Reserve’s target and that the Fed will be data dependent in deciding the interest rate directions.
Two key events that the market will be monitoring include the (i) FOMC (Federal Open Market Committee) meeting minutes (Wednesday); and (ii) the US non-farm payrolls data on Friday.
On the commodity market, Brent crude had a mild pullback after its breakout, ranging along US$86/barrel while gold price is in the sideways consolidation phase. Meanwhile, crude palm oil (CPO) has moved out of the consolidation phase and steadied above RM4,000/metric tonne.
The FBM KLCI index hit 1,600 but ended flat at 1,597 level. The technical readings on the key index were positive with the MACD histogram forming a positive bar and RSI crossed above 50.
The resistance is envisaged around 1,612-1,617 while the support is set at 1,577-1,582. – July 3, 2024
