BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysia stocks retreated further yesterday amid an increase in foreign selling that dominated trades among index-linked stocks.
Healthcare, telcos and plantation stocks were the big losers, sending the FBM KLCI to its lowest level in three months.
Lower liners and broader market shares were also not spared as they endured steep selling, resulting in total losing stocks beating gainers by more than a 2-to-1 ratio for the day.
With the key index slipping further away from its psychological 1,550 level, the near-term outlook is also turning increasingly insipid as there are fewer available buying impetuses, while lingering concerns over global and domestic inflation and higher interest rates are keeping most market players guarded for longer.
Consequently, the near-term uncertainties could continue to cause the market to drift as there is little buying impetus to provide the support to the market.
Any rebound could also be light as is merely an adjustment from a near oversold condition.
The supports are now pegged at 1,530 points followed by the 1,520-1,525 levels. The resistances, meanwhile, are at 1,540 and 1,548 points respectively.
Malacca Securities Research
The FBM KLCI suffered its fourth straight session of decline, marking the longest losing streak since end of January 2022 as banking and healthcare heavyweights led losses.
We believe the sell-down in technology stocks on Wall Street overnight may spill-over to the tech sector on the local front.
However, we still expect selected stocks in the consumer and REITs (real estate investment trusts) sectors to outperform the market on the back of business recovery catalyst.
On the commodity markets, Brent crude traded above US$113/barrel while the crude palm oil (CPO) prices hovered around RM6,450/metric tonne.
The FBM KLCI slipped further into the negative territory to close just above its immediate support at 1,530.
Technical indicators remained mixed as the MACD Histogram slanted downwards towards the zero line while the RSI hovered below 50.
Should the key index breached below 1,530, the next support is located at 1,500. Meanwhile, resistance is set around 1,570-1,580. – May 25, 2022
