BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian equities were again on the ascend amid renewed bargain hunting activities that were prevalent most of the day.
However, the key index ended below its intraday high on quick profit taking activities towards the end of the day.
There was also a substantial jump in trading interest on beaten down stocks like Serba Dinamik Holdings Bhd and Sapura Energy Bhd while many broader market shares and lower liners gained ground to help traded volumes jump to its highest level since February.
The near-term outlook appears more upbeat as Malaysian equites continue to find stability after its recent bout of weakness.
As it is, many stocks are recovering from their oversold positions that is further boosted by the calmer global equities markets.
In addition, the ongoing results reporting season will also be closely followed as the outcome will be used as a gauge on corporate earnings performance for the rest of the year.
While the upside bias remains, quick profit taking activities could also be a feature over the near term as there are prevailing concerns over inflation and supply shortage could shorten the trading duration.
As such, the 1,550 level remains a hurdle for now but if it is cleared, the next targets are at the 1,555-1,558 levels and 1,563 points respectively.
On the other hand, the supports are at the 1,538-1,541 levels followed by 1,534 points.
Malacca Securities Research
The FBM KLCI extended its gains on the back of returned buying interest in selected commodity-related heavyweights led by Press Metal Aluminium Holdings Bhd.
We are expecting that the broad-based recovery on the local bourse could extend in tandem with the (i) rebound on Wall Street overnight following the release of retail sales data in April and (ii) optimism on China’s announcement on easing lockdowns.
On the commodity markets, Brent crude oil has taken some pullback but still hovering above US$110/barrel. Meanwhile, crude palm oil (CPO) is priced around RM6,150/metric tonne. Do note that Indonesian farmers protested against export sales ban on palm oil which may potentially have an impact on CPO prices.
The FBM KLCI marched higher as the key index made another attempt to retest its SMA 200 level. Technical indicators, however, remained negative as the MACD Histogram is still negative while the RSI is hovering below the 50 level.
Resistance is envisaged around 1,570-1,580 while the support is pegged around 1,500-1,510. – May 18, 2022
