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 retreated yesterday as quick profit taking emerged, particularly from foreign funds, to push it end lower again.

Nevertheless, the key index managed to recoup most of its intraday losses late in the session on support from local institutions.

The broader market was mixed albeit market breadth managed to stay on the positive side as there was some renewed interest in some politically linked stocks.

However, overall volumes were again little changed and remained largely in the low side.

With little follow-through buying interest, it appears that the key index is likely to continue drifting for the time being, particularly after it managed to recover most of its window dressing gains and hold on to the 1,390 level.

There are still few leads from overseas markets while domestically market players are awaiting for the conclusion of the upcoming state elections for direction with the Election Committee (EC) to decide on the election date today.

In the interim, the key index will find it hard to stage strong up-moves due to cautiousness over the elections and is likely to remain range-bound between the 1,385 and 1,395 levels over the near term.

The other support and resistance levels are at 1,380 points and the psychological 1,400 level respectively.

Malacca Securities Research

The FBM KLCI shrugged off most of its intraday losses as profit taking activities emerged after a brief rebound last week.

We reckon that further recovery is in store with the key index looking to take another jab towards 1,400. The lower liners may continue to capitalise on calmer market condition on the back of rotational play.

Meanwhile, investors’ attention may shift towards the upcoming Federal Open Market Committee (FOMC) minutes meeting to provide further clues over the pace of future interest rate hikes.

Commodities-wise, Brent crude tipped above US$76/barrel on expectations of further production cuts in anticipation of slower demand from China while crude palm oil (CPO) price maintained above RM3,900/metric tonne.

The FBM KLCI formed a doji candle to pare some of the previous session sharp gains. Still, the key index maintained its position above EMA20. Technical indicators turned mixed as the MACD Histogram extended another positive bar but the RSI slipped below 50.

The immediate resistances are envisaged along 1,413-1,430 while the support is pegged around 1,370. – July 5, 2023

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