Market Review 

MY: Despite heightened concerns over the escalating Middle East conflict, the local index remained resilient following Budget 2027, supported by gains in MISC and PBBANK. Sector-wise, Financials (+0.9%) outperformed, led by PBBANK and MAYBANK, while Health Care (-2.4%) lagged the most. 

US: Wall Street closed mixed on Monday as rising oil prices following a deadly Houthi attack on a Saudi airport and weakness in semiconductor stocks offset gains in Meta and Salesforce ahead of 3Q26 bank earnings and key inflation data. The Dow advanced 0.4%, while the S&P 500 and Nasdaq declined 0.1% and 0.4%, respectively. 

The Day Ahead 

US: With 10-year Treasury yields elevated near 5.25% and Brent crude above USD106/bbl amid Middle East tensions, we expect Wall Street to trade cautiously as JPMorgan (JPM), Goldman Sachs (GS) and Citigroup (C) kick off 3Q26 earnings season today. We favour Alphabet (GOOG), backed by positive analyst views following its Gemini Agent enterprise launch and a 98% reduction in token costs since 2024. Arista Networks (ANET) could benefit from AI networking demand following its open Ethernet rack-scale launch with major tech players. Lastly, traders could consider TD SYNNEX (SNX) following its 3QFY26 EPS beat and stronger guidance. 

MY: Given ongoing geopolitical uncertainty and rebounding oil prices, we expect cautious sentiment to spill over into the local bourse, with investors remaining selective towards post-Budget 2027 beneficiaries. Meanwhile, we are positive on IJM securing a RM1.23bn contract to build a high-tech microchip manufacturing facility for AT&S in Kulim Hi-Tech Park, lifting its outstanding order book to RM10.6bn, equivalent to approximately 1.5x FY26 revenue. Lastly, we also favour MNHLDG following its RM293.9m contract win to develop data centre power facilities, while TNB's RM15bn grid investment should continue to benefit companies involved in transmission and distribution infrastructure.