BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The key index only managed to eked-out minor gains yesterday despite a strong start to the day following the Prime Minister’s unveiling of additional stimulus measures.
This pullback was largely due to the intraday profit taking activities on some of the key index constituents as well as glove maker stocks that remained weak.
On the broader market, conditions were also mixed but many of the lower liner stocks managed to post slight gains that also helped market breadth to end on a slightly positive note.
We see market conditions remaining relatively indifferent and this is also likely to see the key index remaining range-bound.
As it is, noteworthy leads are still far and in-between with the lack of compelling buying opportunities could keep the trades on the lighter side for now.
The weaker oil prices could also hasten profit taking on some of the oil & gas (O&G) stocks that rose recently.
Furthermore, market players are awaiting for corporate earnings to catch up as current valuations are already stretched to largely reflect the potential recovery for the year, in our view.
Under the prevailing environment, we think the sideway trend is likely to continue with the FBM KLCI set to linger between the 1,620 and 1,630 levels for now.
Beyond these levels, the major support and resistance levels are located at 1,600 and 1,640 points respectively.
Malacca Securities Research
The FBM KLCI climbed higher driven by the index-linked recovery-theme stocks’ market optimism over economic recovery following the Prime Minister’s announcement on the “PEMERKASA” economic stimulus package.
However, we believe the overnight declines on Nasdaq may spill-over to the broader market and tech sector today.
On the Brent oil and crude palm oil prices front, both have performed a significant pullback after hitting their respective peaks which may set a negative tone for the energy sector as well.
Tracking the regional advances, the FBM KLCI ended in the positive territory. Technical indicators remained mixed as the MACD Histogram has extended another red bar, while the RSI remained above the 50 level.
To confirm a further upside, a breakthrough needs to be seen at its resistance level at 1,650, while support is pegged around 1,580-1,600. – March 19, 2021
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