What to expect on Bursa Malaysia this Wednesday

BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:

Inter-Pacific Research

Bursa Malaysia stocks mounted a rebound yesterday in tandem with the recovery of most global equities ahead of the US Federal Reserve’s interest rate decision later today.

Bargain hunting emerged, allowing the key index to regain the 1,460 level at the close with transport and logistic stocks leading the way.

Lower liners and broader market shares also regained ground with market breadth returned to the positive side albeit the overall volumes continue to thin.

Despite yesterday’s rebound, we continue to see the market staying cautious ahead of the Fed’s interest rate decision where the rate is expected to be raised by another 75 basis points (bps) amid continuing inflationary pressure.

As it is, market sentiments are still guarded for the most part as the elevated recession concerns could continue to leave most market players on the sidelines.

With few catalysts back home to instil market confidence, this could undo some of yesterday’s gains as quick profit taking activities may emerge.

Therefore, the FBM KLCI could become lacklustre in the day ahead with market players adopting a wait-and-see stance that could leave the key index to drift again.

There will be near-term supports at 1,455 and 1,450 points while the hurdles are at 1,466 and 1,473 points respectively.

Malacca Securities Research

The FBM KLCI staged a rebound from last week’s sell-down as investors snapped up selected banking heavyweights.

Nevertheless, we believe the widespread rout on Wall Street overnight over the aggressive rate hikes concerns will spill over to the regional markets and the local bourse.

Meanwhile, foreign funds remained in a selling undertone (five-day net foreign selling at RM261.4 mil).

Commodities-wise, Brent crude price dropped, trading around the US$90/barrel mark while crude palm oil (CPO) traded above RM3,750/metric tonne.

The FBM KLCI marked notable gains as the key index snapped its four-session losing streak. Technical indicators, however, remained negative as the MACD Histogram extended a negative bar while the RSI hovered below 50.

Resistance is pegged along 1,485-1,500 while the support is located at 1,410-1,430. – Sept 21, 2022

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