BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Malaysian equities retreated again to start the week, bucking the region’s mostly uptrend moves on concerns over the rising local COVID-19 cases and the increasingly restrictive measures.
At the same time, market players were wary over the impending release of the country’s 1Q 2020 gross domestic product (GDP) that is likely to have contracted on a year-on-year (yoy) basis.
The lower liners and broader market shares also pulled back but bucking the downtrend were energy and plantation stocks as commodity prices continue to outperform.
We think that sentiments will remain cautious following the re-imposition of the nationwide movement control order (MCO 3.0).
There will be continuing wariness over the country’s economic prospects with the recovery potentially stalling with the new lockdown measures, albeit the impact will be lesser than the first MCO.
In addition, we think market following could wane ahead of the Hari Raya break and this could further leave the key index in a lurch even as we think there will still be selected interest among commodity stocks.
As such, we see the market’s mild weakness continuing over the near term with the overall buying support likely to thin further.
On the downside, the supports are at 1,578 and 1,573 points respectively, while the resistances are at the 1,590 and the 1,600 points levels.
Malacca Securities Research
The FBM KLCI retreated yesterday after a two-session gain as investors stayed cautious on the sidelines awaiting the release of Malaysia’s 1Q 2021 gross domestic trade (GDP) data today as well as softer trading activities amid the holiday-shortened trading week.
Tracking the weakness from the Wall Street overnight, we expect market sentiment to remain weak following the announcement regarding the expansion of MCO 3.0 to the whole country starting from Wednesday (May 12).
Meanwhile, crude palm oil (CPO) future price contracted after registering a hefty rally recently.
The FBM KLCI retreated after two sessions of gains with milder volume. Technical indicators remained mixed as the MACD Histogram has turned into a green bar, while the RSI was hovering below the 50 level.
Should the key index set a further pullback, support is pegged around 1,555-1,565, while the resistance is set along 1,600-1,620. – May 11, 2021
