The FBM KLCI declined for another session amid profit taking activities. In the US,
trading tone was mixed with the Dow and S&P 500 ended slightly lower, while the
Nasdaq rose for the session. The JOLTS report suggested that the US jobs opening
was the lowest level since early 2021 in October, and the market’s narrative for the
Fed is it has ended with the interest rates upcycle and could be looking at a rate cut
as early as March next year. Thus, with the expectation of an interest rate cut next
year, we think it may provide buying support to the local equities. On the commodity
markets, the Brent oil prices dropped another 1.5% to trade below USD77/bbl amid
unimpressed OPEC+ supply cut and demand concerns.
Sector focus: As the Technology-heavy Nasdaq rose against the weaker backdrop
in the US, we believe the buying interest may build up in the Technology sector on
Bursa exchange. Meanwhile, we think traders may avoid the O&G sector on the back
of weak Brent crude oil price. Following the November reporting month, we opine
that traders will reassess the earnings, we favour selected stocks within the REIT,
Construction, Property, Building Materials and Technology sectors.