BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Attempts to shore up the FBM KLCI and break the downward spell failed as the key index closed in the red again yesterday, extending its losing streak for a fifth straight day.
However, mild bouts of bargain hunting emerged, particularly among the lower liners and broader market shares that helped market breadth to turn positive after their steep falls a day earlier.
This also allowed most Bursa sector indices to end the day in the green with the Industrial Products & Services index being the top gainer.
There are signs that Malaysian equities are staging a recovery after yesterday’s rebound which was relatively broad-based.
However, the revival may also look docile for now as fresh buying interest is still tentative and could just be an adjustment from its oversold conditions.
We still see further recovery attempts over the near term with the mild bargain hunting activities continuing on some of the recently sold down shares, but the strength of a rebound is still uncertain given the prevailing market headwinds that have not showed signs of easing.
Therefore, any rebound could still be mild with the targets set at 1,420 and 1,430 points respectively. On the downside, the 1,408 level – which is the year low – is the immediate support but if that is breached, the next target is at the psychological 1,400 level.
Malacca Securities Research
The FBM KLCI slipped for another session as the key index succumbed to selling pressure in selected banking heavyweights.
However, we believe the local bourse is poised for mild recovery as bargain hunting activities emerged in the previous session.
Nevertheless, any rebound may be capped as investors may stay cautious ahead of the potential recession worries.
Commodities-wise, Brent crude price staged a rebound by trading above US$86/barrel on concerns that Hurricane Ian could disrupt production in the Gulf of Mexico while crude palm oil (CPO) price stayed above RM3,500/metric tonne.
The FBM KLCI closed around the 52-week low of 1,410 on a last minute sell-down. Technical indicators remained negative as the MACD Histogram extended a negative bar while the RSI continued to stay below 30.
Support is located around 1,410, followed by 1,400. Meanwhile, resistance is set at 1,430-1,450. – Sept 28, 2022
