The FBM KLCI experienced a strong flag formation breakout led by significant buying
interest in YTL-related utilities and banking heavyweights. Meanwhile, the US was
closed for holiday break. Events that investors will be watching out this week include
(i) earnings releases from Goldman Sachs and Morgan Stanley, (ii) monthly retail
sales in the US, (iii) US unemployment claims and (iv) China Industrial Production
data. On the local market, we expect overall sentiment to stay positive following the
announcement of 7 consortia submitted RFI proposal for KL-SG HSR project. On the
commodity markets, the Brent oil price gained marginally higher amid rising tension
in the Red Sea region.
Sectors focus: With the potential revival of the KL-SG HSR project, we opine that the
overall Construction and Building Material sectors will be positive in the near term.
We also favour the Property sector, where companies with land banks along the
project may benefit. Meanwhile, the recent signing of the JB-SG SEZ agreement
could provide upside towards investments in the Johor-region and may benefit the
Renewable Energy and Water segments in the future.
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