Upbeat as Market Players Return From CNY Break

Bursa Malaysia rose on Monday led by plantation and oil & gas stocks as more investors returned from the Chinese New Year holidays to bargain hunt. The FBM KLCI climbed 5.06 points to close at 1,538.61, off an early low of 1,530.58 and high of 1,539.25, but losers edged gainers 554 to 447 on total turnover of 3.47bn shares worth RM2.07bn.

Resistance at 1,550/1,580; Supports at 1,505/1,492

The local market should stay upbeat as market players return from the CNY holidays for sector rotational plays, with more fresh domestic leads key to spur further gains. Immediate overhead resistance for the index remains at 1,550, with stronger upside hurdles coming at

1,580 and 1,600. Key uptrend supports cushioning downside will be at 1,505, 1,492 and 1,474, the respective rising 30-day, 50-day and 100-day moving averages.

Bargain Genting Berhad & Genting Malaysia

Genting Berhad need to decisively overcome resistance from the 19/3/21 peak (RM5.13) to enhance upside momentum and aim for RM5.40 and the 123.6%FP (RM5.71) ahead, while the 76.4%FR (RM4.56) and 200-day ma (RM4.36) cushion downside. Similarly, Genting Malaysia will need convincing breakout above the 19/3/21 peak (RM2.96) to target RM3.10 and the

123.6%FP (RM3.26) going forward, with downside capped by the 76.4%FR (RM2.67) and 200- day ma (RM2.57).

China Stocks Rose on Upbeat Travel Data

China’s stock markets rose as traders returned from a long holiday on Monday to upbeat travel data, while Hong Kong stocks fell. The CSI 300 added 0.5% as trading resumed following the Lunar New Year holidays that saw consumer spending jump higher than pre-Covid levels, according to official data. Tourism stocks led the gains, rising 1.2%. The People’s Bank of China on Sunday held a key policy rate steady as expected, as markets reassess when the U.S. Federal Reserve might start easing its monetary policy this year. China’s central bank said it was holding the rate unchanged at 2.5% on 500 billion yuan (USD69.51 billion) worth of one-year medium-term lending facility.

China’s Foreign Minister Wang Yi, reportedly, told U.S. Secretary of State Antony Blinken that the United States must lift restrictions on Chinese firms and individuals, and attempts to de-couple from Beijing would only hurt Washington. Hong Kong’s Hang Seng index fell 1.1%, while the Hang Seng Tech index shed 2.7%. Japan’s Nikkei 225, which had come within a striking distance of a record high on Friday, inched 0.07% lower, while the broader Topix added 0.5%. South Korea’s Kospi added 1.3%, while the smaller-cap Kosdaq was flat. In Australia, the S&P/ASX 200 closed 0.1% higher at 7,665.10.

Europe End Mixed on Stubborn Inflation

European markets ended mixed overnight after chances for early interest rate cuts globally receded and U.S. stock markets are closed for Presidents Day. A red-hot U.S. CPI release on Tuesday followed by another upside surprise in producer prices on Friday left investors anxious inflation will persist. A weaker retail sales report, suggesting slower economic momentum raised their concerns. However, U.S. labour market numbers have continued to show plentiful jobs and elevated wage growth. The surprise on inflation means the minutes of the Fed's last policy meeting out this week will look dated, but any talk about the timing of potential cuts will be noted. There are plenty of Fed speakers out this week to comment on the outlook, with Fed Vice Chair Philip Jefferson and Governor Christopher Waller of particular interest. The market sea change on rates saw two-year Treasury yields spike to a 2024 high of 4.72% on Friday before steadying at 4.64%. Treasury futures were little changed on Monday with the cash market closed.

Source: TA Research - 20 Feb 2024