BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
There was no reprieve for Malaysian equities as they maintained their southward trend amid fresh concerns over the piling up of global and domestic COVID-19 cases that could threaten the economic recovery prospects.
As a result, profit taking and selling activities hastened ahead of the year-end festivities and holidays with the selling also broad-based as losing stocks are overwhelming gainers by a wide margin.
Even after the successive days of consolidation, hopes for a recovery is still absent due to the fading market confidence and the lack of fresh positive leads.
As it is, concerns of the rising COVID-19 cases will continue to cause concerns despite the near availability of vaccines.
At the same time, profit taking actions are still prevalent after November’s strong gains and we see this trend continuing due to the weakening market sentiments.
With global indices also on a consolidation trend, there are even fewer impetuses for a quick recovery, in our view.
Meanwhile, the key index is resting at the 1,631 support, but there remains downside risk for now and the supports are now lowered to 1,620 and the 1,605 points respectively. The resistances are at the 1,640-1,650 levels.
Malacca Securities Research
Without any fresh catalyst, we expect the selling pressure to continue on the local front.
However, the silver lining for today will be the commitment of vaccine roll-out plan by the Malaysian Government.
Meanwhile, market participants could also focus on glove stocks following the new virus strain in the UK which resulted in a faster pace of infected cases.
Besides, investors are waiting for the Kuala Lumpur-Singapore High Speed Rail (HSR) and Large Scale Solar 4 (LSS4) contracts to be dished out in the near term.
The FBM KLCI retraced for the fourth session after hitting the range around 1,696 level. The benchmark index could be due for a technical rebound along the support near the 1,620-1,630 levels. Resistance will be set around 1,660-1,680. – Dec 23, 2020
