Market Review

MY: The local bourse traded higher, brushing off concerns over surging US yields and Fed fears, led by TENAGA and PETGAS. Market breadth remained negative with 603 losers against 484 gainers. Sector-wise, Healthcare (+0.7%) outperformed on gains in PHARMA and KPJ, while Transportation & Logistics (-0.7%) lagged the most.

US: Wall Street was closed for Labor Day. Meanwhile, European stocks ended mixed as the U.S.-Iran conflict kept markets cautious. The Stoxx 600 was flat, while France and Italy gained modestly. Oil prices rose amid continued Middle East tensions, with Brent near USD98/bbl, as hopes for a near-term Iran nuclear agreement faded.

The Day Ahead

US: With Wall Street reopening after the Labor Day holiday, focus is likely to turn to S&P Dow Jones Indices’ quarterly rebalancing candidates such as Bloom Energy (BE), Illumina (ILMN) and Everpure (P). Meanwhile, Micron (MU) should benefit from robust HBM demand, with HBM4 already in high-volume shipments and FQ4FY26 revenue guided at c.US$50bn. Besides, Dell Technologies (DELL) remains supported by strong AI server demand and its record US$95bn backlog, while Super Micro Computer (SMCI) continues to benefit from record AI infrastructure orders and expanding liquid-cooling solutions.

MY: We expect the FBM KLCI to extend its gains on a selective footing amid a mixed global backdrop, with stock-specific catalysts likely to drive interest. We continue to favour PEKAT following its latest three subcontracts worth RM57.2m for earthing and lightning protection works at a hyperscale data centre in Johor. AWC also remains in focus after securing a RM23.1m data centre subcontract, further expanding its exposure to mission-critical infrastructure. Meanwhile, COASTAL staged a 52-week-high breakout following a strong 1H26 profit of RM201.2m, while ECA could ride its continued earnings recovery following its return to profitability in 4Q25, with 1H26 PAT reaching RM3.23m versus a RM6.64m loss previously.