BELOW are excerpts of viewpoints from two chosen analysis homes on what buyers can anticipate within the day forward:
Revenue taking actions dominated trades yesterday, ending the FBM KLCI’s upward streak amid its already prolonged overbought situations.
Promoting actions had been prevalent amongst heavyweight plantation and banking shares however industrial services shares had been the most important losers for the day.
The decrease liners and broader market shares additionally retreated and resulted in losers practically twice the variety of gainers. The promoting spree additionally noticed traded volumes surging to three.8 billion shares yesterday.
Regardless of succumbing to revenue taking yesterday, the important thing index has managed to remain above the psychological 1,450 stage on the shut, suggesting that the uptrend remains to be intact in the interim.
Nonetheless, with situations nonetheless being overbought, the consolidation spell may nonetheless persist for a second day because it continues to regulate from its bout of overbought.
This might put the 1,450 stage liable to being breached though the widely constructive market outlook is prone to maintain in the interim, underpinned by improved urge for food for equities globally whereas the pullback is deemed wholesome for the latest positive factors to be digested.
If the 1,450 ranges fail to carry, the helps are lowered to 1,447 factors and the 200-day shifting common line of 1,437 factors respectively. On the flipside, the hurdles are on the 1,455 and 1,460 ranges – the latter is the newest excessive.
Malacca Securities Analysis
The FBM KLCI took a breather as promoting strain emerged in chosen index heavyweights with international funds turned web sellers for the primary time in six buying and selling days.
In the meantime, the S&P World Manufacturing PMI stood at 47.8 in July 2023, suggesting that sustained slowdown in enterprise situations has some method to go earlier than demand recovers.
However, we opine that the pullback is wholesome to permit latest positive factors to be digested. The decrease liners are additionally experiencing a consolidation with merchants choosing the wait-and-see strategy forward of the six state elections on Aug 12.
Commodities-wise, Brent crude slipped beneath US$85/barrel whereas crude palm oil (CPO) hovered barely beneath RM3,900/metric tonne.
The FBM KLCI fashioned a bearish candle accompanied by softer buying and selling worth. Technical indicators, nonetheless, stayed constructive because the MACD Histogram remained within the constructive territory whereas the RSI hovered within the overbought zone.
Ought to the important thing index superior above the 1,460 stage, subsequent resistances are positioned alongside 1,480-1,500 whereas the help is pegged round 1,420-1,440. – Aug 2, 2023