Dovish Stance - Fed Signals 3 Rate Cute in 2024

The FBM KLCI rebounded for the third session, with the help of buying interest within
selected QL, SIME, and WPRTS. Meanwhile, the US stock markets ended on a strong
note as the Dow charged towards an all-time-high zone, closing above the 37k level
after the Fed signaled that the interest rates have peaked and projected lower policy
rate by end-2024, where the Fed indicated 3 rate cuts next year. Moreover, the US
producer prices were unchanged in November amid cheaper energy goods. Hence,
with that inflation data on a declining trend, we believe it may bode well for the overall
market conditions which we expect further buying interest within the local stock
exchange. On the commodity markets, Brent oil prices rebounded above USD74
following the drop in USD after the Fed’s statements.
Sector focus: Given the bullish Wall Street overnight performance, we think the
buying interest should spillover towards stocks in the Technology sector. Also, we
expect further trading interest within the Glove segment, potentially in tandem with
the rise in Covid-19 cases, coupled with the anticipation of better results from Top
Glove this month.

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