Sideways before charging higher to revisit 1,528-1,548 post CNY

KLCI: 1512.36 (-0.8)
DOW: 38726.33 (49)
MSCI Asia: 167.54 (-0.6)
FCPO (RM): 3909 (35)
BRENT (USD): 81.63 (2.42)
USDMYR: 4.7725 (0.012)
SGDMYR: 3.5487 (0.004)
EURMYR: 5.1464 (0.019)
AUDMYR: 3.1068 (-0.002)
GBPMYR: 6.028 (0.013)
US: 10-yr yield (%) 4.154 (0.033)
BNM:10-yr yield (%) 3.841 (0.014)

Asia/US. Most Asian markets ended firmer, led by a 2.1% rally on NIKKEI 225 amid a set of strong corporate earnings and dovish remarks from BOJ that it will not aggressively tighten its monetary policy even if it decides to end negative interest rates. Meanwhile, SHCOMP gained for the 3rd straight session as hopes of an appointment of new securities regulation head could boost its struggling markets while a persistent Jan’s deflationary pressures in China may encourage further stimulus measures to rejuvenate its struggling economy. Dow rose 49 pts to 38,726 (its 5th gain out of six) as investors assessed a set of mixed earnings results (PYPL, ARM, DIS, RL etc) and the initial jobless claims that came below forecasts, which would eliminate the urgency to lower borrowing costs. Yesterday, Fed President Thomas Barkin reiterated that policymakers have time to be patient about the timing of rate cuts. 

Malaysia. KLCI fluctuated between 1,512.4-1,521.2 band before closing -0.75-pt to 1,512.4 due to the lack of fresh catalysts and lacklustre trading mood ahead of the CNY holidays. Foreign investors (+RM104m, YTD: +RM1.09bn) continued its net inflows for the 6th straight session while local institutions (-RM74m, YTD: -RM349m) and local investors (-RM30m, YTD: -RM745m) were the major net sellers.

Outlook KLCI may waver near 1,500-1,510 supports before re-charging higher towards 1,528-1,548 hurdles next, ahead of the CNY celebrations (Bursa holiday: 12 Feb). Market sentiment is also likely to remain cautious due to ongoing concerns about the Fed's stance on restrictive policy stance, uncertainties surrounding the sustainability of China's stock market rebound, and the expectation of a flurry of upcoming local corporate results after the CNY. 

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