M+ Morning Market Buzz - 19Sep24

Dow Jones: 41,503.10 pts (-103.08pts, -0.25%)
⬆️ Resistance:  42900
⬇️ Support:  39900

FBM KLCI: 1,660.59 pts (-3.69pts, -0.22%)
⬆️ Resistance:  1700
⬇️ Support:  1610

HSI Index: 17,660.02 pts (+237.90pts, +1.37%)
⬆️ Resistance:  18100
⬇️ Support:  16800

Crude Palm Oil: RM3,845 (+RM22, +0.57%)
⬆️ Resistance:  3990
⬇️ Support:  3630

Brent Oil: $73.65 (-$0.05, -0.07%)
⬆️ Resistance:  75.80
⬇️ Support:  69.20

Gold: $2,558.91 (+$1.86, +0.07%)
⬆️ Resistance:  2660
⬇️ Support:  2470

M+ Market update – 19Sep24
Fed Rate Cut Triggered Slowdown Concerns

The FBMKLCI traded lower as investors remained cautious ahead of the Fed’s FOMC meeting. Sentiment was also dampened by selling pressure on YTL and PCHEM. In the US, Wall Street closed lower after the Fed reduced interest rates by 0.5%. We believe this could raise concerns about a potential recession, or at the very least, suggest that the Fed anticipates weaker economic data ahead, prompting such a large rate cut. In the commodities market, Brent oil snapped a two-day rally following the Fed’s rate cut, amid rising concerns over demand from China. Gold prices approached USD 2,600 before retreating to USD 2,555 due to profit-taking. Meanwhile, crude palm oil rebounded on the back of better-than-expected export data.

Sector Focus: With the interest rate cut, we expect the market to focus on REITs. The stronger ringgit could also benefit domestic sectors like Consumer, Utilities, Financial, and Automotive. Additionally, we are optimistic about the Construction and Property sectors, supported by ongoing data center projects and the emerging catalyst from the Johor-Singapore Special Economic Zone.

Stocks to watch: 

Technology: *FRONTKN*, KGB, MYEG
Consumer: *FFB*, LHI
Automotive: *BETA*, SENFONG
O&G: *DELEUM*
Financial: *AMBANK*
Property: KSL

Source: M+

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