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 closed with minute losses again amid the directionless trading environment with market players remaining cautious ahead of the US Federal Reserve’s interest rate decision.
The broader market, however, was mostly positive on a pick-up in trading activities that also helped market breadth to return to the positive side with energy stocks the big movers on higher oil prices.
There was also a surge in traded volume that reached nearly 4.0 billion shares for the day.
We see little movements among the key index stocks over the near-term as there is still a dearth of leads for market players to follow.
At the same time, there remains a hint of cautiousness as the market await the outcome of the next US Fed meeting later today to decide its interest rate direction with the consensus view being that the current rates will remain unchanged for now.
Nevertheless, the prevailing wait-and-see stance is likely to continue and should keep the FBM KLCI trending in a narrow range between the 1,450 and 1,463 levels for the time being.
This would also allow the key index to sustain its base building exercise that could also allow the recent gains to be digested. Apart from the above key support and resistance levels, the others remain at 1,455 points and 1,472 points respectively.
Malacca Securities Research
The FBM KLCI may trade in a sideways tone as investors are likely to stay on the sidelines ahead of the Federal Open Market Committee (FOMC) meeting.
We expect the US Fed to maintain the interest rate direction this round and for the rest of 2023 given the broad trend of the inflation data has declined.
Although the negative performance on Wall Street could spill over to the local front, buying support could emerge within selected sectors as the market may focus on the blueprints of the National Energy Transition Roadmap (NETR) and New Industrial Master Plan (NIMP 2030) for trading opportunities.
Also, we believe traders will start positioning themselves ahead of the Budget 2024. Commodities-wise, Brent crude has continued its uptrend move above the US$94/barrel level but formed an inverted hammer candle while crude palm oil (CPO) prices are still hovering below the RM3,800/metric tonne level.
The FBM KLCI traded flat while maintaining above the 1,450 psychological level. Also, the technical readings on the key index were positive. The MACD Histogram has formed the first positive bar after the rounding bottom formation while the RSI is hovering above 50.
The resistance is located around 1,465-1,470 with the support envisaged around 1,430-1,440. – Sept 20, 2023
