BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
Although the FBM KLCI rebounded yesterday, it was relatively unconvincing as many key index stocks were still directionless.
Banking stocks were again the main movers, followed by selected plantation stocks after palm oil prices rose to a 13-year high, but glove maker stocks continue to falter despite Comfort Gloves Bhd reporting a strong set of earnings.
Elsewhere, the trading environment was also largely mixed even though market breadth was on the positive side for the day.
On the whole, fresh buying is still mostly indifferent as domestic leads are far and in-between of late, in our view.
As a result, bargain hunting activities have also been light due to the directionless trading environment with market players looking at overseas equity markets for leads as well as making careful assessment of the domestic earnings growth prospects for the upcoming quarters.
In addition, there are also fewer compelling buys after the strong rebound from the lockdown conditions last year with market players now waiting for earnings to catch up to the perky equity valuations.
With market conditions still indifferent, we think that the directionless trading environment is likely to persist.
Nevertheless, the key index could continue to make minor gains as it looks to build up a base around the 1,620 level that could allow it to retest the 1,640-1,650 levels in due course.
In the meantime, the immediate supports are at the 1,600-1,610 levels.
Malacca Securities Research
In line with most regional peers, the FBM KLCI started off the week on a positive tone on bargain hunting activities following the two-session pull-back last week.
With the arrival of another batch of Pfizer-BioNTech and Sinovac vaccines yesterday, we believe the key index should be trending higher amid expectation of brighter economic outlook as well as firmer crude palm oil (CPO) and Brent oil prices.
Also, tracking the rebound in Nasdaq, we expect some minor rebound in technology counters today.
The FBM KLCI has closed higher after hovering firmly in the positive region. The technical indicators, however, show mixed sentiment as the MACD Histogram has extended another red bar, while the RSI is hovering above 50.
We reckon that the key index is likely to stay on an upbeat note with resistance pegged around 1,650-1,660 while the support is set at 1,600, followed by 1,580.
