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 regained some ground yesterday but for most of the day, the key index was relatively listless with selected buying interest only emerging late in the session given there were few noteworthy leads.
Nevertheless, it allowed the key index to end the day firmly back above the 1,650 level and also buoyed many of the lower liners.
This saw market breadth returning to the positive side but market interest thinned considerably to just 2.6 billion shares for the day.
Near-term market conditions are likely to become more cautious due to the escalation of the geopolitical conflict in the Middle East.
This could see more market players retreating to the sidelines as they adopt a wait-and-see stance before deciding on their next course of action albeit oil and gas stocks may see some interest due to the higher oil prices.
For the most part, however, sentiments will remain insipid and this is likely to lead to quick profit taking actions.
As a result, the 1,650 level is under threat again on the combination of lower market interest and increased cautiousness even as we think there could be some mild support to keep the key index above the psychological level.
If the level fails to hold, the supports are lowered again to 1,647 points and the 1,640-1,642 levels. The resistances, meanwhile, are at 1,660 points and 1,665 points respectively.
Malacca Securities Research
The FBM KLCI and FBM Small Cap rebounded accompanied by softer trading volume at the start of the Golden Week as China enters a week-long holiday.
Meanwhile, US stocks declined, partly due to Iran’s missile attack on Israel which contributed to rising tension in the Middle East.
We expect this selling pressure to spill over to the local market, limiting gains in the near term.
Key events traders will be monitoring include non-farm payrolls and unemployment claims.
In the commodities market, Brent crude oil spiked over 3% to US$74/barrel while gold surged above US$2,660/oz due to the escalating Middle East conflict. CPO (crude palm oil) prices also gained momentum, surpassing the RM4,070/metric tonne level
The FBM KLCI index rebounded towards the 1,656 level. However, the technical readings on the key index were mixed with the MACD histogram having formed another negative bar but the RSI maintained above 50.
The resistance is envisaged around 1,671-1,676 while the support is set at 1,636-1,641. – Oct 2, 2024
