Downside bias likely to remain on Bursa for time being, says Inter-Pacific

Downside bias likely to remain on Bursa for time being, says Inter-Pacific
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KUALA LUMPUR (Nov 29): Inter-Pacific Securities Sdn Bhd said the near-term outlook will still be dictated by developments on the new Covid-19 variant and the downside bias is likely to remain on Bursa Malaysia for the time being given that there are significant unknowns on the new variant.

In its daily bulletin on Monday (Nov 29), the research house said the emergence of a new Covid-19 variant sent Malaysian equities lower for a fourth straight session and to end the week below the 1,520 level for the first time since August this year.

It said the selling pressure also increased that saw traded volumes shoot up to 4.9 bilion shares on Friday, its highest in a more than a month.

It said most stocks retreated, especially the lower liners, resulting in losers four times more than gainers. However, glovemaker stocks were the big movers as the new variant could drive up demand.

Inter-Pacific said this could cause more market players to opt at reducing their exposure to equities amid the prolonged wariness over its direction and sentiments staying subdued for longer.

It said fresh buying interest would also remain low that could leave the key index to drift lower, even as there could be some mild bargain hunting activities after the recent selldown.

“With the 1,520-level giving way, the 1,500 level is now the psychological support.

“Below that, the main support is pegged at 1,490 points, while there is an interim resistance is at the 1,515 level.

“Beyond 1,520 points, the other hurdle is at 1,525 points,” it said.

Inter-Pacific said the outlook on the lower liners and broader market shares are also becoming more morbid after last Friday’s selloffs.

“Their near-term conditions could remain frail and the selling may sustain due to the increasingly challenging market conditions,” it said.