BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Stocks in Bursa Malaysia continue to head south yesterday, tempered by rising concerns of a potentially more stringent lockdown to curb the spread of COVID-19 in the country.
The early day gains gave way to a new round of selling in the afternoon session as the chatter over the lockdown grew.
Consequently, market breadth also turned negative with many of the lower liners and broader market counters giving up their intraday gains.
The morbid market conditions look to prevail into the last trading day of the week. We think that market sentiments are still guarded ahead of a government meeting to decide on the lockdown later in the day.
This could prolong the wait-and-see stance and keeping most market players on the sidelines for now.
At the same time, it could also sustain the downside bias for longer as the bouts of selling will remain for the time being.
With the market’s weakness looking to stay, the key index may tip back to the 1,565 support and if it gives way, the next support is at the 1,557 level.
On the upside, the hurdles are pegged at 1,580 and 1,590 points respectively
Malacca Securities Research
The FBM KLCI extended losses for the second session as persistent fears over stricter lockdown offset the optimism over the ongoing vaccination programme, given the COVID-19 daily confirmed cases continued to stay above the 6,000 level.
Mild bargain hunting may emerge, but market sentiment may remain cautious as investors will monitor the decision on a full movement control order (MCO) at a National Security Council meeting today.
Commodities-wise, both the crude palm oil (CPO) and oil prices staged a pullback following the recent rally.
The FBM KLCI ended in the negative territory on final hour sell-down, while the EMA20 continued pointing downwards. Technical indicators remained negative as the MACD Histogram has turned into a red bar, while the RSI was hovering below the 50 level.
We expect the key index to trade below the 1,600 psychological level over the near term with support located around 1,555-1,565. – May 21, 2021
