What to expect on Bursa Malaysia today

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 saw mixed trading on a relatively quiet day in the markets but closed higher at the end of trading yesterday on the back of dwindling trade volume and value as investors prepare to go on break for the Lunar New Year.

Market breadth was in the negative with notable winners in the markets yesterday to be the steel-related counters and banking stocks.

For the last trading day of the holiday shortened week, in addition to our local bourse seeing only a half day trading session today, we opine that market conditions may remain muted following the lack of fresh leads from global peers as investors continue to keep a close watch on further updates on stimulus out of the US as well as the remaining foreign and local corporate earnings to be doled out in the following weeks to drive market direction.

Additionally, the sideways trend may yet persist with the closure of China markets for a week beginning today.

Shaking things up would be the release of Malaysia’s 4Q 2020 gross domestic product (GDP) numbers to be released today, with broad expectations that the prolonged lockdown conditions will weigh on the headline figure.

A larger-than-expected dip may trigger some risk-off move and vice versa, but on thin market participation we expect reactions to be limited.

We view the key index to remain guarded for the short term with support levels at 1,585 and 1,590. Near-term resistance levels are at 1,600 and 1,610.

Malacca Securities Research

The FBM KLCI charged higher yesterday, mainly boosted by the gains in banking heavyweights as traders tagged along with the recovery theme.

However, we believe the tone may turn slightly cautious ahead of the Bank Negara Malaysia’s (BNM) announcement on Malaysia’s economic performance for 4Q 2020.

Also, market participants might reduce trading activities prior to the long weekend.

Hence, the FBM KLCI may stay within a range-bound mode throughout the session.

The FBM KLCI soared yesterday, closing around its EMA9 level, but failed to cross above the 1,600 psychological level.

Technical indicators remained mixed as the MACD Histogram has extended another green bar, while the RSI remained below 50.

Should the key index climb above its immediate resistance level at 1,600, further upside could be seen around 1,610-1,620. Support is pegged around 1,550-1,560. – Feb 11, 2021

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