BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Stocks on Bursa Malaysia lost further ground yesterday as selling pressure intensified on heightened geopolitical tensions between Russia and the Ukraine.
This led to the FBM KLCI falling to its lowest level in a month with almost all its constituents ended in the red.
The broader market and lower liners were not spared as they also posted steep losses, contributing to losers beating gainers by a wide margin of nearly 3-to-1. Also, market interest remained thin with less than 3 billion shares traded.
The near-term outlook is likely to stay guarded even as the key index managed to stay above the 1,500 level in yesterday’s sell-down.
As it is, there are still few positive market and economic developments both locally and overseas to calm market players and this will continue to keep sentiments in check.
Furthermore, market participants will be awaiting for the outcome of the upcoming Federal Reserve meeting that is likely to confirm an interest rate lift-off to combat the runaway inflation.
Therefore, the market is likely to stay wary for now, but it could also attempt to find some support around the 1,500 level as the downsides may be reduced after the recent falls and with market players adopting a wait-and-see stance.
However, if this also gives way, the support will be lowered to the 1,400-1,495 levels. On the upside, the resistances are at the 1,518-1,520 levels followed by 1,528 points.
Malacca Securities Research
The FBM KLCI marked its seven-day losing streak amid mounting concerns over geopolitical tension as well as on-going worries on the anticipated rate hikes in the upcoming Federal Open Market Committee (FOMC) meeting.
We believe the downward trend may persist on the local front given Wall Street finished another session in the red. However, we expect investors to pick up significantly bashed down companies with solid fundamentals ahead of the earnings season.
Commodities-wise, crude oil price hovered above the US$88/barrel mark while crude palm oil (CPO) price continued to retreat, hovering above RM5,200/metric tonne. Meanwhile, gold price is creeping higher above the US$1,800/ level.
The FBM KLCI extended losses to the seventh straight session as the key index breached below the SMA50 level. Technical indicators remained negative as the MACD Histogram has extended another negative bar while the RSI continued to hover below 50.
The key index is testing support at 1,500. Meanwhile, the previous support turned resistance is pegged around 1,530. – Jan 26, 2022
