KUALA LUMPUR (Oct 5): Inter-Pacific Securities Sdn Bhd said it still sees the market’s undertone staying cautious for the time being with uncertainties over its direction likely to leave most market players on the sidelines for now.
In its daily bulletin on Tuesday, the research house said it was yet another down day for the key index with selected banking and oil and gas stocks retreating again to extend the FBM KLCI’s consolidation for a third straight day on Monday, which was also due in part to the lack of leads and the weak regional indices.
However, it said the key index managed to close off its day’s low with mild buying support, but losers were still ahead of gainers for the day as conditions in the broader market and the lower liners remained mixed.
Inter-Pacific said that as it is, there remains a dearth of noteworthy domestic leads to attract fresh buying, while market players are also waiting for more tangible results from the resumption of the country’s economic activities.
Meanwhile, it said overseas market events like Evergrande’s defaults and inflationary concerns are also leaving the market in a guarded state and may prolong the insipid market trend.
“As such, we think the downside pressure will sustain over the near term and this may see the key index retesting the 1,520 level.
“A breach of this level would see the next supports at 1,515 and 1,510 points coming into play.
“The hurdles, meanwhile, are at 1,530 and 1,536 points respectively,” it said.
Inter-Pacific said the mixed outlook among the lower liners and broader market shares remains, but we think that significant gains are likely to be far and in-between due to the largely insipid market conditions.
“Therefore, the bouts of buying could still be met by selling into strength actions and leave most of these stocks to drift for longer,” it said.