M+ Morning Market Buzz - 26 Aug 24

Dow Jones: 41,175.08 pts (+462.30pts, +1.14%)
⬆️ Resistance:  42100
⬇️ Support:  39800

FBM KLCI: 1,635.74 pts (-5.92pts, -0.36%)
⬆️ Resistance:  1700
⬇️ Support:  1600

HSI Index: 17,612.10 pts (-28.90pts, -0.16%)
⬆️ Resistance:  18100
⬇️ Support:  16900

Crude Palm Oil: RM3,867 (+RM41, +1.07%)
⬆️ Resistance:  3960
⬇️ Support:  3590

Brent Oil: $79.02 (+$0.49, +0.62%)
⬆️ Resistance:  81.50
⬇️ Support:  74.20

Gold: $2,512.59 (-$0.40, -0.02%)
⬆️ Resistance:  2590
⬇️ Support:  2430

M+ Market update – 26 Aug 24
Dovish Fed Could Spur Buying Interest

The local exchange ended on a negative note prior to the Jackson Hole Symposium, in line with weak regional performances as profit-taking activities emerged. However, positive sentiment was observed on Wall Street following Jerome Powell's speech, which suggested that the Fed might adopt a dovish stance in the upcoming FOMC meeting, with a possible 25 basis point interest rate reduction. Looking ahead, traders will be closely monitoring key economic data, including (i) consumer confidence (Tue), (ii) preliminary GDP (Thu) and (iii) unemployment claims (Thu), and (iv) core PCE data (Fri). In the commodity market, Brent oil surged above USD79 in anticipation of lower interest rates boosting economic activity, while gold prices held steady above USD2,500. CPO prices rebounded significantly, surpassing RM3,800, as sentiment pointing towards positive demand from India ahead of the festive season (September-November).

Sector Focus: With the positive close on Wall Street last Friday, we anticipate buying support to emerge in the local market. While the weaker ringgit may dampen sentiment, the downside could be limited as bargain-hunting activities pick up in line with the US stock markets. Meanwhile, we favour the O&G sector, given the rebound in crude oil prices. Also, the Consumer, Aviation, Construction, Building Materials, and Automotive sectors could benefit in a stronger ringgit environment.

Stocks to watch: 

Construction: *MGB*, *PESONA*, SSB8
Banking: CIMB, *RHBBANK*
Technology: *BETA*
O&G: *DELEUM*
Power: MFCB

Source: M+

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