KUALA LUMPUR (April 1): Inter-Pacific Securities Sdn Bhd said it sees the key FBM KLCI index continuing to drift over the near term as leads are still far and in-between.
In its daily bulletin on Friday (April 1), the research house said the overnight weakness among key global equities could further leave market conditions guarded at the start of the new quarter.
It said this may see the key index remaining mostly sideways due to the still insipid conditions where concerns over inflation, the Russia/Ukraine war and their corresponding impact on economic and earnings growth lingers in the background.
“As such, the FBM KLCI may trend within the 1,580 and the 1,600 levels for the time being.
“There is a minor support at the 1,585 level, while the interim resistance is at the 1,590 level,” it said,
Inter-Pacific said many broader market shares and lower liners also made headway on Thursday to end the first quarter, but the continuing lack of following is likely to keep conditions subdued heading into the weekend.
“For the most part, however, the sideway trend is set to prolong in the absence of significantly positive leads,” it said.
Hong Leong Investment Bank said that after sliding 21 points m-o-m in a volatile trading in March (hovered within 1,540.9-1,620.4 band), the FBM KLCI is expected to stay choppy in April (supports: 1,545-1,561-1,575; resistances: 1,600-1,620-1,642) amid a prolonged Russia-Ukraine conflict (despite ongoing ceasefire talks), Shanghai’s restricted lockdowns, elevated inflation and worries of the Fed can achieve a “soft landing” for the US economy.
However, in its traders’ brief the research house said the downside risk is likely to be well-cushioned by: i) persistent foreign net inflows; ii) high crude oil and CPO prices; iii) Malaysia’s shift into endemic phase and reopening of international borders; and iv) a possible “election rally” on the horizon.