Follow Us For The Latest Updates

Follow Us For The Latest Updates

What’s Trending? (9th Nov 2020)

All eyes were glued on the US Presidential Election as the country went to the polls to elect its 46th President. Concerns over the rapid spread of the COVID-19 pandemic were temporarily cast aside last week, as investors jumped back into the market.

All eyes were glued on the US Presidential Election as the country went to the polls to elect its 46th President. Concerns over the rapid spread of the COVID-19 pandemic were temporarily cast aside last week, as investors jumped back into the market. Risk assets across most major indices climbed higher, while the Dollar weakness provided support for Gold price to rise alongside risk assets. It was only after the trading week that we saw the results being announced, with Joe Biden being elected as the 46th US President. 

In The News

  • Global markets were focused on the US last week as Americans turned to polling stations to cast their vote for their 46th President.  It wasn’t until the weekend that we saw vote counts confirming Joe Biden as the country’s latest president-elect, alongside his running mate, Kamala Harris as his vice-president elect. 
  • Concerns surrounding the rapid rise in pandemic cases were momentarily cast aside despite now having more than 50 million cases globally, and resulted to more than 1.25 million fatalities.  Stricter lockdown measures are expected to take place across the globe as we continue to scramble for a vaccine.
  • England, Greece, and France have all announced lockdown measures to prevent further spread of the virus, while Spain imposed nighttime curfews.  Malaysia also announced stricter movement controls as case numbers continue to rise.
  • The effects from the pandemic continue to weigh on economic growth, leaving global central banks to maintain an accommodative stance.  Last week saw the US Feds leaving its interest rates unchanged, while keeping open the possibility of an expansion to its QE program.
  • The tech-sector regained its position as one of the top performers, with the NYSE FANG+ Index gaining 7.86% over the week, and contributed to the 16.63% returns for 0830EA. Returns from the tech-sector outpaced that of the broader market, as the S&P 500 rose 6.68% in MYR terms over the same period.
  • The Bank of Japan reiterated that it will not be altering its ETF-buying program.  The BoJ anticipates to invest USD115 billion into ETFs annually, stating that the program is aimed to prevent significant market swings, and aimed at protecting investors’ sentiment.
  • China’s equity market rose over the week on optimism that Biden would be able to clench the Presidential seat from Trump, which would help mend the current strained relationship between the US, and China.
  • Investors’ sentiment was further boosted with the stronger economic data flowing out of China, a momentum that investors anticipate to continue till year-end.  The Shanghai Composite, and the CSI 300 Index both rose 3.35%, and 4.69% respectively, while the consumption and services-focused S&P New China Sectors Ex A Share Index rose 7.31% with the support of its tech stocks. 
  • The 0829EA, which tracks the S&P New China Sectors Index, has enjoyed a steady climb over the course of the year, recording a YTD gain of 38.36% in MYR terms and announced that it will be making it’s 1st income distribution this quarter.
  • China’s consumption sector stocks have continued to do well as domestic consumers shift back into the market with its “revenge spending”.  More support is expected to be seen with the up-coming Single’s Day sale. 
  • The suspension of the highly anticipated Ant Group IPO shocked global markets after the news was announced 2 days prior to its debut. The brakes were pulled after regulators found that the Company no longer met the regulator’s listing requirements.  Ant Group is said to be refunding its IPO investors, along with brokerage fees and interest.
  • Closer to home, the domestic market also climbed higher as sentiment improved.  Whilst the KLCI inched 3.60% higher last week, momentum stocks enjoyed a stronger run, benefitting the 0836EA which rose 3.94% over the same period.
  • Glove stocks continued its upward momentum, gaining further support with the absence of the earlier mentioned “windfall tax” in the budget which was announced last Friday.
  • Gold price spiked last week led by the uncertainties surrounding the outcome of the US presidential election. But with the US Dollar losing ground, analysts are expecting support for the precious metal if volatility in the equity market continues. The 0828EA rose 3.21% last week after Gold price breached the USD1,950 per ounce level, the highest since September.  Gold remains one of the strongest performing asset class this year, with the 0828EA already recording a YTD gain of in excess of 27% in MYR terms. 

On the Economic Data Front

  • US data shows promise
    • 638,000 jobs were added last month 
    • Unemployment rate dipped from 7.9% in September, to 6.9% in October
    • Concerns have, however, arisen over the sustainability of the job numbers as stricter lockdown measures may dampen numbers
  • China continues to see growth
    • October’s Caixin/Markit PMI at 53.6 – sees growth for the 6th straight month – highest reading since Jan 2011
    • Official PMI released at 51.4 – beating expectations of 51.3

ETF strategies at TradePlus

A look at the performance of TradePlus ETFs, and major global indices

Email disclaimer: This information has been provided for information purposes for the intended recipients only.  Information contained should not be copied, distributed, or otherwise disseminated in whole or in part without written consent from Affin Hwang Asset Management Berhad (“AHAM”). Information contains opinions, analysis, forecasts, projections, and expectations which has been obtained from various sources, including those in the public domain, and are merely expressions of belief. AHAM makes no expressed, or implied warranty as to the accuracy and completeness of any such information.  As with any forms of financial products, the financial products mentioned herein (if any), carries with it various investment risks. AHAM is not acting as an advisor or agent to any person to whom this communication is directed. Such persons must make their own independent assessments. Nothing in this communication is intended to be, or should be construed as an offer to buy or sell, or invitation to subscribe for, any securities.  Neither AHAM, nor any of its directors, employees or representatives are to have any liability (including liability to any person by reason of negligence, or negligent misstatement) from any statement, opinion, information, or matter (expressed or implied) arising out of, contained in, or derived from, or any omission from this communication, except liability under statue that cannot be excluded.  You may obtain further information regarding product details, risks, and full disclaimers for TradePlus products and its Benchmark Indices here.


Share on facebook
Share on twitter
Share on linkedin
Share on telegram

More Posts

market pulse

Market momentum still sturdy

The FBM KLCI edged mildly lower as sentiment turned downbeat as investors booked in gains from the previous session rally. While the local bourse is demonstrating some mild weakness, we reckon that the general recovery trend is still intact as the attention remains focus on the pace of economic recovery. The positive development over the Covid-19 vaccine will also continue to aid the recovery progress. Meanwhile, the lower liners are expected to charge higher, driven by the ample liquidity with the equities market remain in favour.

AME Elite Consortium Bhd – 2nd Dec 20

The proposed AME REIT would also provide stable and recurring income to investors, with at least 90.0% of its income to be distributed as dividends to unitholders. We note that slightly more than half of the current tenants of the industrial properties has more than 5 years of lease under their agreements. Additionally, AME REIT is expected to benefit from lower tax rate compared to prevailing corporate tax rate at an average of 23.4% recorded over the past 4 years.

technical focus

Technical Focus – 2nd Dec 20

Established historical track record since inception in 1975 with strong brand presence in the Malaysia household market. Demand will be relatively healthy, owing to the rising awareness of personal hygiene following the Covid-19 pandemic. Disposal of loss-making toilet rolls and tissue manufacturing subsidiary; NTMP Paper Mill (Bentong) Sdn Bhd allow the group to streamline and focus on the existing core businesses. Technically, price has experienced a flag-formation breakout above RM0.73, targeting the next resistances at RM0.795-0.815 with long term target at RM0.90.

market pulse

Swift recovery

Expectedly, the FBM KLCI performed a swift recovery as the key index recouped most of its previous session losses to re-claim the 1,600 psychological level. We reckon some stability will ensue with further upsides are in the cards as investors continue to focus on the economic recovery progress. Meanwhile, we believe that the lower liners will continue to enjoy their upward momentum as liquidity remains well on the equities market with investors capitalising on the positive market sentiment.