M+ Morning Market Buzz - 31 Jul 24

Dow Jones: 40,743.33 pts (+203.40pts, +0.50%)
⬆️ Resistance:  41700
⬇️ Support:  39100

FBM KLCI: 1,611.94 pts (-12.62pts, -0.78%)
⬆️ Resistance:  1670
⬇️ Support:  1580

HSI Index: 17,002.91 pts (-235.43pts, -1.37%)
⬆️ Resistance:  17900
⬇️ Support:  16600

Crude Palm Oil: RM3,915 (-RM15, -0.38%)
⬆️ Resistance:  4080
⬇️ Support:  3790

Brent Oil: $78.63 (-$1.15, -1.44%)
⬆️ Resistance:  84.40
⬇️ Support:  76.90

Gold: $2,410.78 (-$1.86, -0.08%)
⬆️ Resistance:  2490
⬇️ Support:  2310

M+ Market update – 31 Jul 24
Further Profit Taking Activities Expected

From a decent start of the day, the FBMKLCI took a sudden change of course into negative territory led by selling pressure on selected utilities heavyweights, while both the FBM70 and FBM Small Cap followed. Meanwhile, in the US, technology stocks were beaten down prior to the conclusion of the FOMC meeting. Despite MSFT earnings beating consensus, the share price was down post-market due to a mildly weaker cloud segment, and this may drag AI-themed stocks in the near term. The 2-day FOMC meeting and the sentiment on the US election are the key focuses in the near term and may provide high volatility in the markets. In the commodity markets, Brent oil declined further below USD79 despite US inventories falling for five weeks straight, while the gold regained its move above USD2400. The CPO price traded sideways along RM3900.

Sectors Focus: Given the US markets were locking in profits in the technology sector, this may spill over to the stocks on the local front. Also, the selldown may be widespread towards the data center theme that has rallied in 1H2024. Nevertheless, there might be decent buy-on-dip opportunities if the domestic corporate earnings season in August disappoints, as we think the revenue and earnings will only materialize by 2025. Meanwhile, we still like the Sarawak-related stocks as well as selected Construction, Property, Consumer, and Water-related stocks.

Stocks to watch: 

O&G: DAYANG, *PERDANA*, *SENDAI*
Consumer: *FOCUSP*, HUPSENG
Construction: *BNASTRA*, ECONBHD
Properties: *MAHSING*
Water-related: SALCON

Source: M+

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