BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian stocks extended their gains with renewed buying from foreign funds enabling the FBM KLCI to climb back to the psychological 1,400 level at the close.
Market conditions on Bursa Malaysia were much improved alongside the upsides in global indices.
Beaten down technology and plantation stocks were among the main movers with lower liners also following suit to keep market breadth positive for the day. The return of bargain hunting activities also pushed up the traded volumes.
The near-term outlook is still positive, premised on the ongoing recovery in global equities that will also extend to stocks on Bursa Malaysia.
As it is, market valuations remain compelling and below their longer-term trends. This is renewing the bargain hunting activities as well as allowing for the recovery from their oversold conditions to continue.
The recovery also provides hope that the worst could be over for stocks on Bursa Malaysia even as the market volatility is likely to continue for the foreseeable future due to the unsettled economic environment heading into 2023.
In the interim, the ongoing rebound could see the FBM KLCI targeting the 1,406 level before heading to the 1,413 level. The supports, meanwhile, are at 1,394 and 1,390 points respectively.
Malacca Securities Research
The FBM KLCI saw a comeback buoyed by buying momentum from foreign funds following a positive cue from Wall Street.
Investors may shrug off some recession fear in the near term to position themselves in the ongoing 3Q 2022 reporting season on Wall Street.
Meanwhile, we expect sentiment on the local bourse to stabilise once the 15th General Election (GE15) official date is announced later this week.
Commodities-wise, Brent crude oil traded above US$90/barrel while crude palm oil (CPO) price sustained above RM4,000/metric tonne.
Note that crude oil price may continue to settle lower on the back of higher US supply and lower fuel demand from China.
The FBM KLCI rebounded to close above the key 1,400 and its daily EMA-9 level. Technical indicators remained negative as the MACD Histogram geared towards zero in the negative zone while the RSI hovered below 50. – Oct 19, 2022
Resistance is set along 1,420-1,430 while the support is envisaged along 1,355-1,365. – Oct 19, 2022
