The FBM KLCI snapped a 6-day winning streak as profit taking activities emerged
despite YTL-related heavyweights gaining further momentum. Meanwhile, the US
stock markets ended on a mixed note with the Dow charged towards fresh all-timehighs,
while S&P500 and Nasdaq fell as the market stayed cautious on the
Technology shares prior to the conclusion of the FOMC meeting. Hence, we expect
continuation of profit taking activities on the local front with the Evergrande incident.
On the commodity markets, Brent oil traded firmer above USD82/bbl after the solid
US jobs data, suggesting that the US economic activities continue to grow, coupled
with the ongoing Middle East tension.
Sectors focus: We expect the overall market may consolidate with the FBM Small
Cap turning lower at this juncture. Nevertheless, we still like the Construction,
Property, Building Material sectors for the trading theme within the (i) KL-SG HSR, (ii)
easing requirements of the MM2H and (iii) Johor-related investments. Meanwhile,
we believe the O&G sector may sustain its momentum as Brent oil price hovers
above USD82/bbl. Besides, with the LSS5 announcement recently, there will be a
spike of trading interest within solar EPCC players.
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