BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian equities continued to climb, bucking the regional weakness on sustained rotational plays and continuing interest from foreign institutions.
Heavy buying was seen in steel, construction and consumer discretionary stocks that was buoyed by the re-opening theme.
The positive trend was also apparent in the broader market, albeit the number of total gainers narrowed against losing stocks due to increased profit taking with traded volumes about a quarter lower than the previous day.
Even after extending its winning streak for a sixth consecutive day, the near-term outlook remains positive due to a stronger pick-up in market interest which could also signal a possible end of the pandemic that has affected the country for the past 18 months.
As such, rotational buying is likely to continue with stocks on Bursa Malaysia playing catch up to the year-to-date gains in many foreign bourses.
We also see some mild hesitation on bouts of profit taking but the weakness is likely to be short-lived as there is still strong buying interest that could help to lift the key index to the 1,590 level.
However, we think the psychological 1,600 level is still a formidable level to clear and is likely to remain steadfast for the time being. The supports, meanwhile, are at the 1,580 and 1,575 levels respectively.
Malacca Securities Research
Bucking the regional markets, the FBM KLCI extended its winning streak for the sixth session, buoyed by persistent buying interest in index-linked banking and telecommunication heavyweights on the back of positive sentiment in tandem with the rising foreign buying interest.
Despite the overnight negative performance on Wall Street, we believe the local bourse may remain bullish over the near term by moving closer to the 1,600 psychological level, supported by the re-opening of economic activities as vaccination rate of adult population has achieved above 90%.
Commodities-wise, both the crude palm oil (CPO) and crude oil prices saw a pullback as inflationary concerns picked up.
The FBM KLCI finished at intraday high, crossing above its immediate resistance level at 1,580 and the SMA200 level. Technical indicators remained positive as the MACD Histogram has extended a green bar while the RSI is trending higher above 50.
The next resistance is envisaged at 1,600 while the support is set at 1550. – Oct 13, 2021
