Malaysia market commentary (9 Dec 2024)

Interestingly, last Friday NFP roared back and grew by 227k in November, but market focused more on household survey that demonstrated employment decreased 355k. Investors see this was an indicator of labour market losing steam.

Market further priced in from 74% to 85% chance of one rate cut of 25 bps on 18 Dec FOMC meeting while UST 10 years edged south from 4.18% to 4.14%.

S&P500 jumped 28% this year and closed above 6,000 (all time high). Some analysts project more decent returns in year 2025. Goldman Sachs, JPMorgan forecast that S&P500 can further rally to 6,500 by end of next year, Barclays revise the target to 6,600 while Deutsche is even more bullish with view of 7,000.

Syria news hit the headlines whereby Assad’s family dictatorship falls after ruling more than 50 years, raising concerns of a vacuum. This sparks worries about how this event spillover across middle-east.

Local currency enjoyed improved risk sentiment, USDMYR closed lower at 4.4195 (-80pips) while Malaysia 10 years government yield settled unchanged at 3.85%.

KLCI closed at 1,613 (-2.39) with daily traded volume of MYR 2.82 billion. Foreign equity outflow was trendy, last Friday, offshore continued unwinding domestic equities of MYR 143 million. YTD equity flow accumulated to MYR -2.10 billion. There is lack of catalyst for offshore to come back now as US indices made all-time high.

Healthcare (+2.19%) was the champion again, thanks to SUPERMX and TOPGLOV. This aligns with our expectations after Trump win that gloves may benefit from the strong dollar and protectionism policy. Energy (+1.04%), construction (+0.69) and consumer (+0.48%) also rallied overnight.

Other sectors were only in small negative, plantation (-0.49%), telecommunication (-0.24%) and financial (-0.14%) retreated and gave back some gains. Overall, most indices performed last week.

Gloves are back, the volume of SUPERMX and TOPGLOV skyrocketed as they attracted trading interest. SUPERMX closed at 1.06 (+7.61%) while TOPGLOV settled at 1.32 (+5.60%). We saw small buying activity on TOPGLOV from offshore, such as BlackRock and State Street.

99SMART (+3.98%) enjoyed the party as FTSE chooses it to be included as KLCI index constituent.