BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The key index underwent a mild pullback yesterday as some of its recent strong gains are absorbed, ending its six-day winning streak.
For most of the day, the market was directionless with profit taking activities taking hold even as there were sustained support from foreign funds as local players were net sellers.
Although market breadth turned negative, lower liner indices maintained their ascend amid a pick-up in traded volumes.
Market conditions could stay directionless in the near term as there are fewer compelling buying opportunities after the near 80-point gains recently.
Even the rotational buying interest may be waning after the prices of many of the laggards have caught up.
As a result, a holding pattern may re-emerge with the key index attempting to stay close to the 1,450 level, aiming to build up a base around the level as the key index also looks to stay above the new year-low that was formed in the middle of the month.
The mild profit taking actions may continue but there will also be bouts of bargain hunting that would keep the market afloat for the time being.
Above the 1,450 resistance, the next hurdle is at 1,460 points while the supports are set at the 1,438-1,440 levels, followed by the 1,430 level.
Malacca Securities Research
The FBM KLCI took a breather from earlier winning streak as profit-taking activities emerged in Petronas-related and selected banking heavyweights.
However, we believe that buying interest could spill-over from Wall Street to stocks on the local front coupled with foreign investors turning net buyers (five-day net buy valued at RM37.1 mil).
Meanwhile, traders might be attuning towards the 15th General Election (GE15) theme or re-tabling of Budget 2023 after the GE15.
Commodities-wise, Brent crude price traded above US$93barrel while crude palm oil (CPO) price hovered above RM4,150/metric tonne.
The FBM KLCI retreated to close slightly below its daily EMA60 level, snapping the six-day winning streak. Market breadth, however, remained positive as the MACD Histogram extended a positive bar while the RSI remained above 50.
Resistance is envisaged along 1,465-1,485 while support is set at 1,400-1,420. – Oct 26, 2022
