KUALA LUMPUR: Hwang DBS Vickers Research (HDBSVR) said the week's performance, starting March 28, could set the course for the Malaysian equities as the stock exchange enters the second quarter of the year.
'Should the benchmark FBM KLCI cross 1,530 anytime soon, we believe a firmer recovery is already underway,' it said on Monday, March 28.
HDBSVR said slowly but steadily, the key market barometer rose bit by bit every day to chalk up a weekly gain of 11.7 points or 0.8%, settling at 1,515.55 last Friday.
It said that rebounding even more the past week were the FBM 70 Index and the FBM ACE Index, up 2.5% and 6.0%, respectively. Daily average volume and value came in at 1.2b shares and RM1.8b, more than the 1.0b units worth RM1.6b traded the previous week.
'Institutional investors, especially from overseas, have been keen to carry out selective bargain-hunting of Malaysia equities of late. This was the case last week when foreign institutional funds were net buyers ' to the tune of approximately RM175m worth of shares ' according to the stock exchange.
'Another indication of likely fund inflows from overseas is the Ringgit strength, climbing to RM3.0265 per US$ currently (a new high since the lifting of the currency peg in Jul 2005),' it said.
HDBSVR said if the buying appetite persists, then our local bourse could have hit a short-term bottom already. Its leading FBM KLCI ' after a maximum tumble of 6.5% from a high of 1,576.95 in early Jan to a trough of 1,474.38 in end-Feb ' may be in the midst of finding a stable footing currently.
While downside risk seems fairly limited for now, its upward movements are likely to be gradual in the absence of fresh market stimulating news flows.
'From a technical perspective, things are beginning to look a little more favourable now. The current position of the FBM KLCI ' which has simultaneously pulled away from the negative sloping channel and cut above the 39-day moving average line (a fairly dependable historical gauge for market support) ' signals a positive bias as we approach the end of the first quarter.
'A confirmation of this recovery trend will probably come should the benchmark index break past the immediate resistance barrier of 1,530 and kick its way towards the next resistance target of 1,550.
'On the flip side, if the breakout signal proves to be false, then the FBM KLCI is expected to head south and challenge the first two support levels of 1,495 and 1,465, respectively,' it said.
'Should the benchmark FBM KLCI cross 1,530 anytime soon, we believe a firmer recovery is already underway,' it said on Monday, March 28.
HDBSVR said slowly but steadily, the key market barometer rose bit by bit every day to chalk up a weekly gain of 11.7 points or 0.8%, settling at 1,515.55 last Friday.
It said that rebounding even more the past week were the FBM 70 Index and the FBM ACE Index, up 2.5% and 6.0%, respectively. Daily average volume and value came in at 1.2b shares and RM1.8b, more than the 1.0b units worth RM1.6b traded the previous week.
'Institutional investors, especially from overseas, have been keen to carry out selective bargain-hunting of Malaysia equities of late. This was the case last week when foreign institutional funds were net buyers ' to the tune of approximately RM175m worth of shares ' according to the stock exchange.
'Another indication of likely fund inflows from overseas is the Ringgit strength, climbing to RM3.0265 per US$ currently (a new high since the lifting of the currency peg in Jul 2005),' it said.
HDBSVR said if the buying appetite persists, then our local bourse could have hit a short-term bottom already. Its leading FBM KLCI ' after a maximum tumble of 6.5% from a high of 1,576.95 in early Jan to a trough of 1,474.38 in end-Feb ' may be in the midst of finding a stable footing currently.
While downside risk seems fairly limited for now, its upward movements are likely to be gradual in the absence of fresh market stimulating news flows.
'From a technical perspective, things are beginning to look a little more favourable now. The current position of the FBM KLCI ' which has simultaneously pulled away from the negative sloping channel and cut above the 39-day moving average line (a fairly dependable historical gauge for market support) ' signals a positive bias as we approach the end of the first quarter.
'A confirmation of this recovery trend will probably come should the benchmark index break past the immediate resistance barrier of 1,530 and kick its way towards the next resistance target of 1,550.
'On the flip side, if the breakout signal proves to be false, then the FBM KLCI is expected to head south and challenge the first two support levels of 1,495 and 1,465, respectively,' it said.
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