Bursa Malaysia has moved higher in back-to-back sessions, collecting almost 7 points or 0.5 percent in that span.
The Kuala Lumpur Composite Index now sits just above the 1,540-point plateau although it may run out of steam on Monday.
At 9.16am, the FBMKLCI dipped -3.61 points to open at 1,540.23.
RHB Retail Research in a note today (Mar 25) said the FKLI managed to stage a rebound during Friday’s session, climbing 2.50 pts to close at 1,543 pts – poised to resume the upward movement.
The index opened at 1,541.50 pts and after forming an intraday low at 1,537 pts, it climbed to the day’s high at 1,546 pts and closed at 1,543 pts.
RHB observe that Friday’s low (1,537 pts) was higher than Thursday’s low of 1,534.50 pts.
The “higher low” affirms that the bulls still have the advantage, with the strong support established at 1,533 pts.
Meanwhile, the 50-day SMA line continues to move higher, strengthening the bullish technical setup.
For the immediate session, the index may attempt to test the 1,550-pt immediate resistance.
For now, the bullish structure remains intact. As such, they retain the positive trading bias.
RHB recommend traders to keep the long positions initiated at 1,455 pts, or the close of 3 Nov 2023.
To manage the downside risks, the trailing-stop is raised to 1,520 pts from 1,500 pts.
The first support remains unchanged at 1,533 pts – 20 Mar’s low – followed by 1,520 pts.
On the other hand, the first resistance is revised to 1,550 pts, followed by 1,563 pts ie the high of 28 Feb.
Malacca Securities (MSSB) said the FBMKLCI (+0.06%) ended flat, in line the mostly negative performance
in the regional stock markets, as gains in Telco and Banking heavyweights were offset by losses in Industrial Products heavyweights.
On the broader market, the Property sector (+1.25%) gained, while the Plantation sector (-0.22%) declined.
The Day Ahead
Last week, the FBM KLCI rebounded marginally for 2 consecutive days, but closing the week lower by 0.67%; as attention was shifted to FBM Small Cap, rallying by
1.69%.
In the US, Nasdaq traded at all-time-high position, while DJI and S&P500 closed higher for the week as the market could be pricing in dovish statements from
the Fed as 3 rate cuts are anticipated, while persisted optimism over AI theme supported the overall market’s movements.
Hence, given this setup, MSSB believe buying support will extend to the local exchange.
On the commodity markets, Brent oil pulled back but hovering above US85, while the crude palm oil has hit resistance along RM4,300 and traded lower for the near term.
Besides, the gold price maintained above USD2,160 zone.
Sectors focus: Given the ongoing optimism on the AI theme and Technology sector continues to stay elevated, they believe the buying interest will spillover towards stocks on the local front; we like INARI, UNISEM, FRONTKN, FPI and MPI.
Meanwhile, YINSON registered a good set of earnings, while VELESTO won a contract extension of about RM1.26bn, hence we expect more robust trading activities within the O&G sector.
Besides, they like Utilities, Construction, Consumer, Packaging and Solar.
Bloomberg FBMKLCI Technical Outlook
The FBMKLCI index ended flat.
The technical readings on the key index were mixed,
with the MACD Histogram hovering marginally below 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 Asian stock markets finished the week on a mixed note against the rebound in the US dollar.
The local benchmark FBMKLCI (KLCI) inched up 0.98pts or 0.06% to end the day at 1,542.39.
Week-on-week, the index dropped 10.44pts or 0.67%. Sector-wise, property (+1.25%) led the top gainer for the day followed by technology (+0.65%) and construction (+0.34%).
The underperforming sectors were plantation (-0.22%), industrial products (-0.16%) and energy (-0.03%).
Trading volume increased to 5.09bn (up from 4.02bn on Thursday) whereas trading value fell to RM2.69bn (down from RM2.94bn previously).
Market breadth turned negative as 538 gainers lost marginally to 544 decliners.
The benchmark formed a doji-like candle last Friday and continued to test the resistance line from the 1,518 low.
The current sideways consolidation is likely to extend for a while longer.
Once this consolidation ends, they expect the KLCI to ascend further.
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 longerterm resistance is placed at 1,570-1,583.
CGS International portfolio stays in risk-on mode this week.
