BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
The key index retreated yesterday and was more severe than expected as it slipped back to near the 1,470 level in what was seen as profit taking from the recent end-of-year window dressing activities.
The FBM KLCI’s retreat also bucked the mostly higher regional trend after plantation stocks emerged as the day’s biggest losers.
Traded volumes, however, jumped on increased interest on the lower liners and broader market shares even as market breadth stayed negative for the day.
We see near-term market sentiments remaining unsettled as most players are still looking for a definitive market direction and the absence of which is likely to keep the FBM KLCI subdued for the time being.
As it is, there are still few domestic impetuses to entice market players to take up more positions and with little change to the country’s economic fundamentals, the key index is likely to continue drifting for the time being.
Also, overseas leads are mostly negative, and this could still dampen market sentiments that is leaving the 1,470 support under threat.
If this is breached, the supports are lowered to the 1,460-1,465 levels. The 1,480 level is the immediate resistance, followed by the 1,483 level.
Malacca Securities Research
The FBM KLCI kicked off the first trading day in 2023 in the negative territory as market digested recent gains buoyed by year-end window dressing activities.
We believe the pull-back could be deemed as “healthy” with bargain hunting activities likely to pick up in undervalued stocks despite worries over the COVID-19 sub-variants may continue to weigh on investors’ sentiment.
Still, we believe the re-opening of China’s travel borders may provide decent growth for most of the global economies with another round of pent-up demand.
Commodities-wise, Brent crude traded around US$82/barrel while crude palm oil (CPO) price hovered above RM4,200/metric tonne.
The FBM KLCI closed lower after trading in the negative territory for the entire session. Technical indicators, however remained positive as the MACD Histogram extended a positive bar while the RSI is hovering above 50.
Support is located at 1,450-1,460, while the resistance is pegged along 1,500-1,510. – Jan 4, 2023