BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Conditions among index-linked companies remain subdued yesterday as profit taking still dominated trades, particularly among banking stocks that also saw the key index bucking the region’s mostly upbeat performance.
However, conditions elsewhere were more positive as many lower liners and broader market shares remained on the upside on the back of increased trading activities. As a result, gainers beat loser on a 2-to-1 ratio while traded volumes continue to climb.
The directionless trading outlook on the FBM KLCI looks to prolong as it is unable to find sufficient traction to head higher in the absence of new catalysts.
This will leave it to drift for longer but could remain close to the 1,600 level for the time being.
As it is, there is still little selling pressure now but fresh buying interest on index heavyweights are also muted after most stocks have managed to recover from their earlier sell-off that was induced by the geopolitical issues in Eastern Europe.
Under the prevailing condition, the broadly sideway will linger with slight downside bias remaining following the overnight weakness of key global indices. There are supports at 1,590 and 1,583 points respectively while the resistances are at the 1,600-1,602 levels.
Malacca Securities Research
The FBM KLCI saw another session of pull-back amid further profit taking in banking and telecommunication heavyweights.
Meanwhile, global sentiment may stay fragile amid concerns over a more hawkish stance of the US Federal Reserve’s action to tame inflation.
Also, we expect the unresolved tension between Russia and Ukraine could limit the upside potential over the near term.
Nevertheless, we expect re-opening of travel borders to continue to benefit the economy while investors could position themselves ahead of the 15th General Election (GE15) albeit the timeline is still uncertain.
On the commodities market, both the crude oil and crude palm oil (CPO) price remained elevated despite a mild pull-back overnight.
The FBM KLCI managed to hold above the daily EMA9. Technical indicators remained mixed as the Histogram is below zero while the RSI is hovering above the 50 level.
Resistance is set around 1,600-1,620 while the support is located at 1,580. – April 6, 2022
