The FBM KLCI eked out marginal gains as investors traded cautiously prior to the US inflation data. Following a cooling inflation print in the US, investors may anticipate a less aggressive tone from the Fed moving forward. The optimism on Wall Street overnight, coupled with the higher Brent crude oil price around USD84 per barrel could lift the sentiment on our local bourse.

The FBM KLCI attempted a modest rebound, powered by gains in selected telecommunication and banking heavyweights amid improving sentiment following the China reopening theme. As the Wall Street extended its gains amid hopes for easing US inflation, the local bourse is likely to build on yesterday’s momentum. Meanwhile, next event that the market will be watching out could be the upcoming FOMC meeting that will be held on 31-Jan to 1-Feb.

We expect the contract will be able to produce a high single-digit EBITDA margins, which is in line with similar works performed by the group historically. With KGB starting off the year on a high gear, we expect further contracts to come by for the remainder of FY23f.

Guan Chong Bhd (GCB) engaged in the manufacturing and trading of cocoa-derived food ingredients and cocoa related products. To-date, GCB’s total capacity stands at 337kMT p.a., ranking the group as the fourth largest cocoa grinder in the world.

The FBM KLCI traded lower for the session as investors took profit prior to Jerome Powell’s speech and the US CPI data later this week. While the expectations of a tighter monetary policy may continue to weigh on market, we believe the local bourse could be on track for further recovery as the reopening of China’s border will dominate investors’ sentiment over the near term.

The FBM KLCI mounted solid recovery in tandem with the regional peers, cheering the positive movements on Wall Street last Friday as reopening of China borders lifted investors’ sentiment. Should the key index sustain above the SMA200 zone, the sentiment will likely to turn more bullish over the near term. However, given the emergence of cautious sentiment on Wall Street overnight due to lingering worries over global inflation, it may cap the upside potential on the local front.

The FBM KLCI ended marginally lower amidst the mixed regional markets sentiment, paring most of its intraday losses as bargain hunting activities emerged. We believe the jump on Wall Street on Friday, coupled with the reopening of China’s border could spark a rally on the regional markets as well as on the local bourse. We believe the market is more positive-biased on the inflationary pressure as the US December 2022 payroll came in greater than expected, but the slowdown in wage growth could indicate that the Fed’s battle against inflation may have an impact.

The FBM KLCI rebounded into the positive territory as foreign funds turned into net buyer after 4-day outflow streak. While the reopening of China borders may continue to stimulate economic activities, the stock markets may remain volatile as recessionary concerns could still remain as top agenda following the release of US job data overnight, which may signalled further increase in interest rate outlook.