M+ Morning Market Buzz - 17 Jul 24

Dow Jones: 40,954.48 pts (+742.76pts, +1.85%)
⬆️ Resistance:  41900
⬇️ Support:  38500

FBM KLCI: 1,625.96 pts (-3.86pts, -0.24%)
⬆️ Resistance:  1670
⬇️ Support:  1590

HSI Index: 17,727.98 pts (-287.96pts, -1.60%)
⬆️ Resistance:  18700
⬇️ Support:  17200

Crude Palm Oil: RM3,925 (+RM20, +0.51%)
⬆️ Resistance:  4080
⬇️ Support:  3780

Brent Oil: $83.73 (-$1.12, -1.32%)
⬆️ Resistance:  88.10
⬇️ Support:  81.70

Gold: $2,469.08 (-$0.17, -0.01%)
⬆️ Resistance:  2520
⬇️ Support:  2320

M+ Market update – 17 Jul 24
Rotation Into Small Cap Stocks

Profit taking activities emerged on the local front and led by industrial products and technology stocks. Meanwhile, the US stock markets rose in anticipation of potential rate cuts in the upcoming September FOMC meeting, the Dow saw the best jump since 2023, while investors could be rotating to small caps in view of lower debt repayment rate with the potential rate cut by 2H2024. Meanwhile, traders will be watching out the industrial products and unemployment data later this week. On the commodity markets, Brent oil fell and ended below USD84 amid lingering demand concerns from China, while the gold price shot up strongly towards new highs. The CPO price rebounded off support around RM3850.

Sectors focus: As investors could be rotating out of the big caps tech stocks, there might be follow-up profit taking activities on the local front revolving the data center catalysts. Nonetheless, we expect it may provide buy-on-dip opportunities going forward within the Construction, EMS, Building Material, Utilities and Property sectors. Additionally, both the NETR and NIMP will still be creating jobs and boosting the economic activities going forward. Other sectors that we favour include the shipping industry in view of stronger earnings. 

Stocks to watch: 

Technology: *CENSOF*, GREATEC, *SCOMNET*, SKPRES, *VS*
Shipping: HARBOUR, *SYGROUP*
Construction: *HSSEB* 
Building Material: *MSC*
Utility: MALAKOF

Source: M+

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