KUALA LUMPUR (Nov 21): Inter-Pacific Research Sdn Bhd said that with no clear winner in the recently concluded elections, market conditions are likely to be volatile at the start of the week as the political impasse will leave investor sentiments wary
In its daily bulletin on Monday (Nov 21), the research house said the FBM KLCI edged higher last Thursday on end-of day supports on selected banking heavyweights to help it close in the positive territory ahead of voting on the 15th General Election.
However, it said conditions in the broader market were insipid as market players await for the outcome of the election that resulted in losers getting the upper hand against gainers for the day.
It said traded volumes also stayed mostly muted even as the total trades rose some 14% for the day.
“With no clear winner in the recently concluded elections, market conditions are likely to be volatile at the start of the week as the political impasse will leave investor sentiments wary.
“The impasse could also see a knee jerk reaction to politically sensitive stocks like gaming and brewery stocks that could endure a fresh round of selling as market players may opt to retreat to the sidelines until there is clarity in the country’s political environment,” it said.
Inter-Pacific said the market uncertainties could also see other heavyweights succumbing to a fresh round of selling that may even prolong until the next government is in place.
“Depending on the reaction to the hung parliament, the FBM KLCI may retreat to the 1,440, but if it gives way, the ensuing supports are at 1,430 and 1,420 points respectively.
“On the upside, the immediate hurdle is the psychological 1,450 level, followed by the 1,460 level,” it said.