BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The selling escalated on Bursa Malaysia yesterday with the FBM KLCI slipping below the psychological 1,600 points level in line with the weakness in regional indices.
Market conditions were spooked by renewed worries over the direction of the global economy amid the new lockdowns and slower inoculation process.
Market breadth was expectedly negative with losers dominating gainers nearly on a 3-to-1 ratio as profit taking on stocks in the oil & gas (O&G), banking and gaming segments and on most lower liners escalated.
The near-term outlook appears increasingly negative following the recent fall of the FBM KLCI to below the 1,600 points level.
This has fortified the unappealing market conditions that has also seen investor participation dwindling of late as most market players are continuing to stay on the sidelines, awaiting for a clearer market direction to emerge.
This, coupled with the lack of positive catalysts and the weakness on Wall Street overnight as well as the stumbling oil prices, are likely to leave sentiments frayed with the index heavyweights on Bursa Malaysia looking to ease further over the near term.
With the 1,600-level now breached, the supports are now lowered to 1,590 and 1,580 points respectively. Meanwhile, the 1,600 level is the immediate resistance, followed by the 1,607 points.
Malacca Securities Research
The FBM KLCI extended its losing streak for the third straight session despite the earlier positive momentum on Wall Street.
Although bargain hunting may emerge in certain bashed-down stocks, we believe the upside may be capped in the near term as investors may trade in a cautious mode given the overnight losses at Wall Street amid concerns over US bond yield, weaker oil price and intensifying COVID-19 cases in Europe.
Meanwhile, the CPO price has continued its uptrend move.The FBM KLCI finished below the 1,600 psychological level after hovering in the negative territory for the entire trading session.
Technical indicators have turned negative with the MACD Histogram extending another red bar, while the RSI has fallen below 50.
Given the key index has fallen below the 1,600 level, the next support will be set around 1,580, followed by 1,560, while the resistance is pegged at 1,600-1,625. – March 24, 2021
