Rise With Regional Strength on US Pivot Optimism

Bursa Malaysia shares were stuck in range bound trade on Monday before late buying in plantation and utility blue chips lifted the blue-chip benchmark index to end at the session’s high. The FBM KLCI closed up 4.42 points at 1,446.39, off an intra-day low of 1,440.4, as gainers led losers 483 to 397 on total turnover of 3.81bn shares worth RM2.47bn.

Resistance at 1,465/1,470; Better Supports at 1,430/1,400

The local market should rise in line with the region ahead of the closely watched US inflation data and FOMC meeting, amid increasing optimism the US Federal Reserve may eventually pivot towards rate cuts sometime next year. On the index, immediate resistance remains at 1,465/1,470, with the 1,490/1,500 area acting as tougher upside hurdle. Better chart supports are at 1,430, and then 1,400/1,390, while the end June low of 1,370 will act as crucial support.

Bargain MRCB & UEM Sunrise

MRCB will need to overcome strong profit-taking resistance at the upper Bollinger band (46sen) and 123.6%FP (48sen) before aiming for the 138.2%FP (51sen) and 150%FP (53sen) going forward, while retracement supports from the 76.4%FR (40sen) and 61.8%FR (38sen) cushion downside. UEM Sunrise need decisive breakout above the 50-day ma (78sen) to target immediate upside hurdles at 80sen/85sen and the 123.6%FP (89sen) ahead, while the lower Bollinger band (66sen) and 76.4%FR (64sen) limits downside risk.

Asian Markets Advance Ahead of U.S. Inflation Data, Fed Outcome

Asian markets rose on Monday ahead of a week packed with a quintet of central bank meetings and data on U.S. inflation that could make or break market hopes for an early and rapid-fire round of rate cuts next year. Focus now turns to the Federal Open Market Committee (FOMC) policy meeting later this week and U.S. inflation data due ahead of that, where expectations are for consumer prices to continue easing on an annual basis. Softening inflation and employment data in the past month have convinced investors that the Fed is done raising interest rates and ignited bets that cuts of at least 125 basis points were in store over the next 12 months.

This week, traders will also be keeping an eye on policy decisions at the European Central Bank and Bank of England, while jobs data in Australia and economic activity gauges in Europe are also due. Japan’s Nikkei 225 ended 1.5% higher at 32,791.80, while the broad based Topix added 1.47% to close at 2,358.55. South Korea’s Kospi closed 0.30% higher at 2,525.36, and the small cap Kosdaq was up 0.59% at 835.25. In Australia, the S&P/ASX 200 inched higher by 0.06% to 7,199.00, while the Shanghai composite index rose 0.74% to 2,991.44.

Wall Street Ticks Higher Ahead of Inflation Data

Stocks ticked higher on Wall Street as global investors look ahead to this week’s crucial inflation readings and Federal Reserve policy meeting. The Dow Jones Industrial Average rose 0.43% to 36,404.93. The S&P added 0.39% to 4,622.44, while the Nasdaq Composite gained 0.20% to 14,432.49. The forthcoming slate of economic data are some of the final obstacles left for markets to remain strong into the end of 2023. Investors will eye the Consumer Price Index data due on late Tuesday, which is expected to show headline inflation remaining unchanged in November, followed by the Producer Price Index and the last interest rate decision of the year from the Fed on Wednesday.

The Federal Open Markets Committee's two-day monetary policy meeting will end on Wednesday with its interest rate decision and the release of its summary economic projections. Fed funds futures pricing suggests a nearly 40% likelihood that the central bank will lower rates by a quarter of a point in March. Later in the week, the European Central Bank and the Bank of England, are also due to make policy announcements. Macy’s shares rallied more than 29% on news the retailer received a buyout offer for USD5.8 billion.

Source: TA Research - 12 Dec 2023