Inter-Pacific says market conditions are getting tougher
Kuala Lumpur (November 26): With the benchmark index dropping below the 1,520 support level, Inter-Pacific Securities Sdn Bhd said market conditions are becoming more challenging with the potential for a dip in buying interest.
In its daily bulletin today, the Research House said the benchmark index fell below the support level of 1,520 as selling accelerated yesterday with the market remaining apathetic with fewer catalysts available and market players still hesitating on their investment decisions.
As a result, she said, market breadth was flatly negative with shares losing more than twice as many gainers.
At the same time, he said the increased selling was reflected in a jump in trading volumes, which rose to 3.8 billion shares as the broader market’s shares consolidated further.
Inter Pacific said sentiment remains stalemate as market players choose to remain on the sidelines amid a lack of positive signs to encourage them to return to the market.
Meanwhile, she said, there remains caution about the rising cost of equity transactions and the potential for earnings growth to slow next year.
“Therefore, selling pressure is likely to continue ahead of the weekend, although we do not rule out some moderate buying support after consecutive days of selling.
“FBM KLCI support is now held at 1515 and 1505 points before the psychological impact starts at 1500 points.
“The near-term barriers, on the other hand, are 1,520 and 1,527 points, respectively,” she said.
Inter-Pacific said lower lines and broader market shares have also seen an increase in selling over the past few sessions, and this could be exacerbated with fewer leads available and a corresponding lack of follow-up.
“As a result, the downward pressure still prevails, and this may lead to a decline in these stocks by the end of the week,” she added.