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

The FBM KLCI ended the day with minute gains as it recovered from the intraday losses with end- of-day bargain hunting on selected index heavyweights in the plantation sector after crude palm oil (CPO) prices climbed.

In the broader market, healthcare stocks remained on the ascend due to surging COVID-19 cases in China.

Market breadth, however, were negative despite the positive performance of many of the broader market shares that helped traded volumes climb back above the 3 billion sharea level.

Market conditions are likely to stay relatively calm to allow stocks on the FBM KLCI to stay supported amid mild bouts of window dressing.

This should at least keep the key index above the 1,470 level ahead of the extended year-end break ahead.

The relatively settled key global indices of late would also help to shore up market sentiments for the time being as worries over the increasingly challenging global economic conditions in 2023 is temporarily cast aside on optimism that China’s re-opening will buoy the region’s economic undertone.

With the mild upsides likely to prevail over the near term, the immediate target is set at the 1,480 level, followed by the 1,490 level. On the flipside, the 1,470 level is the immediate support, followed by the 1,460 level.

Malacca Securities Research

The FBM KLCI traded unchanged at the start of holiday-shortened week amid worries over the worsening COVID-19 situation in China.

While quick profit-taking activities on Wall Street could imply that the outlook remained gloomy on the global front, we believe the local bourse may be poised for further recovery on the back of bargain-hunting activities as China’s loosening of COVID-19 quarantine measures should boost tourism activities going forward.

Commodities-wise, Brent crude price steadied above US$84/barrel on prospects for re-opening demand from China as well as Russia’s banning of supply to countries that impose a price cap. Meanwhile, CPO price settled above RM4,100/metric tonne.

The FBM KLCI closed flat and well supported above its daily EMA9 level. Technical indicators remained mixed as the MACD Histogram extended a negative bar while the RSI is hovering above 50.

Resistance is set along 1,500-1,510 while the support is located at 1,460, followed by 1,450. – Dec 28, 2022

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