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 managed to mount a minor rebound yesterday to recapture the 1,420 level, breaking its recent steep downward streak that ended 3Q 2023 on a whimper.

While the key index was grudgingly higher, conditions in the broader market were still dour, hampered by the lack of positive catalysts that left many of the lower liners in a state of flux again with market breath remaining in the negative territory.

However, traded volumes picked up amid the sustained selling streak.

Despite the key index’s rebound yesterday, market conditions are still dour amid the continuing cautious market undertone that is affected by concerns over the slower global economic growth prospects heading into 2024.

As it is, the ongoing prognosis is for global growth to slow further due to the combination of elevated prices and sustained high interest rates that could affect demand, an effect that caused Wall Street to also pull back sharply overnight.

With conditions still guarded, the listless market environment is likely to persist for now with the downside bias to also dominate sentiments for the time being. If the 1,420 level gives way again, the supports are lowered to the 1,413 and 1,410 levels while the resistances are at 1,425 and 1,435 points respectively.

Malacca Securities Research

The FBM KLCI ended marginally higher for the session but traders may continue to stay cautious throughout this week.

With the Wall Street and regional benchmark indices taken a beating yesterday, we expect selling pressure to emerge on the local front.

Also, as we are heading into the Budget 2024 period, investors may position themselves ahead of this event.

Meanwhile, with the elevated inflationary pressure, rising US Treasury yields as well as expectations of another possible interest rate hike move by the US Federal Reserves, downward pressure on stock markets may continue.

Commodities-wise, Brent crude hovered around the US$90/barrel level amid rising US dollar while crude palm oil (CPO) prices traded below the RM3,700/metric tonne level.

The FBM KLCI ended marginally higher slightly above the current support zone of 1,400-1,420. However, the technical readings on the key index were negative with the MACD Histogram having extended another negative bar while the RSI hovering slightly above 30.

The resistance is located around 1,450-1,460 with the support located around 1,400-1,415. – Oct 4, 2023

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