Malaysia market commentary (26 Nov 2024)

Global markets
Overnight, the US indices continued uptrend whereby DJ (+0.99%) closed record high as market was in risk-on mode on the nomination of Scott Bessent as Treasury Secretary. This role is important in economic and trade regulations. Bessent has called for deregulation and tax reforms and opposed overly strict trade tariffs. S&P (+0.30%) and NASDAQ (+0.27%) joined the optimism too.

VIX is the implied volatility of 1month S&P500, gauging market sentiment. The higher the VIX, the more panic the market. It trended lower and closed at 14.60, showing market complacency.

U.S. 10-Year Treasury Yield
10-year yield decreased from 4.40% to close at 4.29%. CMEfuturesprice in 57% for 1 rate cut of 25 bps on 18th Dec 24 meeting. PCE price index will be the inflation gauge of Fed whether they should take cautious stance before further rate cut.

Malaysia markets
Local Macro
USDMYR stabilized and closed lower from 4.48 to 4.46 level. 10-year MGS yield closed at monthly low of 3.86%, down from 4.10%. Bond outflow was huge, estimated at MYR 7.13 billion this quarter-to-date. Foreigners unwind fair bit, hence YTD bond inflow dropped to MYR 4.55 billion.

KLCI Performance
Local index advanced slightly and closed at 1,597 (+7.67 or +0.48%). Domesticequityvolume skyrocketed from previous day of MYR 2.21 billion to MYR 5.41 billion, thanks to MSCI portfolio rebalancing. Yesterday portfolio investments rebalanced their local equities according to the MSCI weightage. We saw surging volume in large cap such as banking stocks, CIMB (+1.95%), PBBANK (+1.60%).

Sector performance:
Sectors performances were mixed. Winners were leaded by tech (+1.96%), followed by utilities (+1.56%), financial (+1.32%), and energy (+1.14%). While the decliners consist of consumer (-0.83%), telecommunications (-0.64%) and industrial production (-0.23%).In this unchartered territory, while pending more policy signals from the US, local financial and utilities attract more interest from investors.

Local earnings released:
Now earning season. Maybank, KLK on 26 Nov; SIME, RHBBANK on 27 Nov. We expect more intraday volatility on these events.

Stockon focus:
YTL and YTLPOWR took the centre of the stage in the morning trading session, buoyant by rebound from the recent downtrend and both closed higher at 1.85 (+4.52%) and 3.06 (+5.52%).