Malaysia market commentary (28 Nov 2024)

Overnight, the US markets took a cautious step after soaring to record high, ahead of Thanksgiving holiday. All 3 indices were in red territory, DJ (-0.31%), S&P (-0.38%) and Nasdaq (-0.59%).

PCE price index met expectations, annual 2.3% while core PCE was up 2.8% in October. The inflation gauge is still above 2% Fed’s target. The inflation data increased the probability of 25 bps rate cut in December from 63% a day earlier to 67% according to Bloomberg WIRP. US 10-year treasury yield declined slightly to 4.26%.

VIX settled almost unchanged at 14.10, demonstrating market complacency.

Local currency was in risk-on mode. USDMYR edged lower and closed at 4.4440 (-0.0135). 10-year MGS yield consolidated at 3.86% (+0.03%).

Index continued hovering around 1,600 level and closed almost no change at 1,604 (+1.10). Market breadth improved whereby gainers of 590 outrun losers of 480. Trading volume increased to MYR 2.99 billion from MYR 2.37 billion.

Foreigners continued selling local equities at MYR 413 million yesterday, since August 2024. YTD foreign equity flow slumped to negative region after yesterday selling pressure from offshore. Foreign equity YTD flow reached yearly high of MYR +4.42 billion on 20 Sep and all the way declined until yesterday of MYR -90 million.

As what we last discussed after US election, portfolio fund would shift their allocation from emerging markets, back to the US as Trump may impose tax cut and protectionism policy. Hence, local market lack of catalyst for upside at this juncture.

Overall, sector performances were mixed. Gainers were utilities (+1.79%), followed by property (+0.63%), consumers (+0.36%) and others. While the losers were led by plantation (-0.68%), property (-0.37%) and energy (-0.30%).

While pending for more clear signals and guidance, utilities and financial are preferred by investors for their defensive features.

Earning season now. Many companies released their financial results. INARI reported profit of MYR 24.12 million, down 71.6% YoY while IJM recorded profit of MYR 74.21 million, down 20.8% YoY. Noticeably, INRI recorded lower profit due to the strengthening of MYR.

YTL and YTLPOWR continued taking the centre of the stage. Both share price advanced with strong momentum and closed at 2.09 (+0.14) and 3.42 (+0.22) respectively with almost double trading volume.