Bursa Malaysia on Thursday ended the two-day slide in which it had stumbled almost 20 points or 1.2 percent.
The Kuala Lumpur Composite Index now sits just above the 1,540-point plateau and it may add to its winnings on Friday.
At 9.16am, the FBMKLCI rose +0.26 points to open at 1,541.56.
RHB Retail Research in a note today (Mar 22) said following a recent pullback, the FKLI is now poised to extend the rebound from the immediate support after having rebounded 5 pts yesterday to settle at 1,540.50 pts.
This confirms the support at the 1,533-pt immediate level.
The index opened at 1,537 pts and traded in a positive tone, oscillating between 1,534.50 pts and 1,544 pts, and closing above the opening.
The latest rebound solidifies our earlier expectations for the pullback to be temporary, with the FKLI eyeing to resume its uptrend towards the 1,563-pt immediate resistance, ie the 52-week high.
This would be before potentially trending higher towards the 1,600-pt mark. The RSI indicator has improved to 54% from 52% previously, indicating an improved positive momentum that is likely to persist going forward.
Coupled with the strong uptrend structure above the ascending 50- and 200-day SMA line they maintain their bullish trading bias.
Traders should maintain the long positions initiated at 1,455 pts or the close of 3 Nov 2023.
To minimise the downside risks, the trailing-stop threshold is fixed at 1,500 pts.
The immediate support stays at 1,533 pts – 20 Mar’s low – and is followed by 1,520 pts.
Meanwhile, the immediate resistance is still pegged at 1,563 pts –28 Feb’s high – and followed by the higher resistance of 1,600 pts.
Malacca Securities (MSSB) said the FBMKLCI (+0.37%) ended higher, in line the positive performance in the regional stock markets, led by selected Telco, Banking and Plantation heavyweights.
On the broader market, the Property sector (+1.49%) was the leading sector, while the Healthcare sector (-0.57%) declined.
The Day Ahead
The FBMKLCI rose after a two-day pullback lifted by selected heavyweights within Telco, Banking and Plantation.
Again, in the US stock markets, the sentiment was positive following the dovish statements from the Fed’s FOMC meeting and contributed to an extended rally within the Technology sector; dot plot expects 3 rate cuts.
With this positive trading activity in the US, we opine that the buying support should spillover to stocks on the local front.
On the commodity markets, Brent oil retreated for the second day, but still hovering above the USD84/bbl, while the crude palm oil traded sideways within RM4,200-4,300.
Besides, the Gold prices surged towards USD2,222 before closing below USD2,200 level.
Sectors focus: MSSB think the buying interest may continue to emerge within the Technology sector, taking cue from the US stock markets; they like INARI, UNISEM and MPI.
Meanwhile, they favour the commodity-related sectors such as O&G, Plantation and Gold with the anticipation of a softer interest rates environment going forward.
Besides, on the local catalysts, we expect Johor-theme, KL-SG HSR as well as NETR will provide upside opportunities within Construction, Property and Renewable Energy.
Bloomberg FBMKLCI Technical Outlook
The FBM KLCI index ended higher.
The technical readings on the key index were mixed, with the MACD Histogram hovering flattish along 0, while the RSI is above 50.
The resistance is envisaged around 1,555-1,560 and the support is set at 1,525-1,530.
CGS International said Most Asian stock markets rallied on Thursday as investors cheered on the Fed’s dovish comments about the US interest-rates cut(s).
The local benchmark FBMKLCI (KLCI) rebounded 5.62pts or 0.37% to end the day at 1,541.41.
The broader market was lifted by property (+1.49%), construction (+1.31%) and technology (+1.01%).
The only laggards for the day were healthcare (-0.57%), REIT (-0.33%), energy (-0.22%) and telecommunications (-0.11%).
Trading volume climbed to 4.02bn (up from 3.82bn on Wednesday) while trading value improved to RM2.94bn (up from RM2.66bn previously).
Market breadth turned positive as 631 gainers beat 451 decliners.
The benchmark formed an inside bar yesterday, testing the resistance line from the 1,518 low.
The index is on course to extend its current sideways consolidation.
The 1,525-1,531 level acts as the minor support, followed by the 1,508-1,521 band.
On the upside, 1,545 acts as the immediate resistance before KLCI moves to retest the 20-month high at 1,559 and beyond.
The longer-term resistance is placed at 1,570-1,583. Our portfolio stays in risk-on mode this week.
