BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The selling on local equities continued overnight with the FBM KLCI slipping to its lowest level in a month on concerns that the on-going Russia-Ukraine dispute could further stall global economic recovery.
In addition, the market was also spooked by concerns over commodities trades after the London Metal Exchange suspended trading on nickel.
Meanwhile, lower liners and broader market shares slipped further amid sustained selling with market breadth remaining decidedly negative.
With sentiments remaining unsettled, the market is likely to stay guarded over the near-term which could also prolong the FBM KLCI’s downside bias.
Selling could still dominate trades as market players continue to take a defensive stance, hence may continue to exit stocks that have made significant headway in the past month, particularly those that are commodity-related.
At the same time, the key index has breached successive technical support levels by extending the weakness trend with few signs of a reprieve as yet.
Under the prevailing environment, there could be more weakness over the near term with the supports now pegged at 1,542 and 1,533 points respectively. The 1,550 level is the immediate resistance followed by the 1,555 level.
Malacca Securities Research
Sentiment on the local stock market remained bearish as another broad-based sell-off pushed the FBM KLCI into the negative territory amid persisted worries over the ongoing tension between Russia and Ukraine.
Although there might be mild bargain hunting activities in selected commodity stocks, we expect overall gains to be likely short-lived, taking cue from the overnight Wall Street performance.
Do note that investors will be monitoring the elevated commodity prices that may translate to significant inflation and input costs to various industries.
Brent crude oil price hovered above the US$125/barrel mark while crude palm oil (CPO) is priced above RM6,400/metric tonne. Meanwhile, gold price soared above the US$2,000/ounce mark.
The FBM KLCI fell below the daily EMA120 level and closed below the support at 1,550 on the back of persisted selling pressure.
Technical indicators show bearish signal as the MACD Histogram turned negative while the RSI hovered below the 50 level.
The next support is pegged around the previous low at 1,520 while the resistance is located at 1,570-1,580. – March 9, 2022
