BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The slight uptick in Malaysian equities stalled last Friday as profit taking resumed to send the key index below the 1,580 level again, much of it due to the retreat of glove maker alongside selected plantation stocks.
In addition, mild bargain hunting activity also evaporated and as a result, traded volumes slipped with the lower liners and broader market shares staying mixed.
There remain few noteworthy leads for market players to follow and we see the key index staying mostly range-bound ahead of the Lunar New Year break at the end of the week.
The lack of leads would also see the market remaining thin with market players awaiting for the release of the country’s 4Q 2020 gross domestic product (GDP) later in the week before charting their next course.
In the interim, overall market sentiments are still cautious due to the ongoing pandemic conditions and concerns over the country’s economic outlook for 1H 2021 that is likely to be affected by the latest lockdown amid the unabated COVID-19 cases.
Nevertheless, we think the key index will attempt to make some headway to climb back above the 1,580 level before resuming its range-bound trend within the 1,580 and 1,600 points levels.
The other support is at the 1,570 level.
Malacca Securities Research
The FBM KLCI underperformed its regional peers last Friday as gloves and plantation heavyweights lost their ground following their recent rallies.
The selling pressure among local and foreign institutions continued to weigh on the local bourse despite buying interest among local retail investors.
With the US stock markets inching higher last Friday, we expect the local bourse may see some rebound, but traders should be trading cautiously ahead of the Lunar New Year holiday.
The lower liners may see some rebound ahead of the vaccine rollout.
The FBM KLCI snapped its three-day gains but managed to close marginally above the EMA120 level.
We think the 1,600 is still crucial for the FBM KLCI, should it hovers below 1,600, the key index should continue to trade on a range-bound manner.
Support is pegged around 1,560, followed by 1,550. On the technical indicators, the MACD Histogram has turned red while the RSI remained below 50. – Feb 8, 2021
