Market Review

MY: The local bourse ended higher as gains in YTLPOWR and YTL lifted the FBM KLCI into positive territory. Market breadth was positive, with 657 gainers outpacing 410 losers. Sector-wise, Technology (+1.83%) outperformed, supported by gains in VITROX and SKYECHIP, while Property (-0.48%) was the weakest performer.

US: Wall Street rose on Wednesday as strength in industrials, basic materials, and tech lifted indices. The S&P 500 climbed 0.28%, the Nasdaq added 0.27%, and the Dow gained 0.19%, led by American Express and a 10.7% Oracle jump. Lower volatility and easing crude oil supported sentiment despite a pull-back in Nvidia.

The Day Ahead

US: Following the Fed’s decision to hold rates, with Chair Warsh providing no clear signal on December’s move, we expect mixed trading as investors weigh Alphabet’s disappointing 3Q26 results and negative free cash flow against Microsoft’s Azure-led earnings beat. Stock-wise, we favour Marvell Technology (MRVL), which is reportedly in advanced talks to acquire Lumentum. A potential deal could broaden its optical interconnect capabilities for AI datacentre networking, although its terms and funding remain key considerations. Meanwhile, Veeva Systems (VEEV) remains on our radar following the announcement of AI tools designed to streamline clinical study setup.

MY: Despite the Fed’s decision to hold rates, Alphabet’s disappointing results and negative free cash flow could weigh on local sentiment, particularly in the Technology sector. Stock-wise, we continue to favour HKB, supported by its RM851m order book, equivalent to approximately 6.8x FY25 revenue. SLVEST’s increased stake of approximately 16.4% could also strengthen HKB’s access to utility and renewable energy opportunities, including high-voltage substation projects. Meanwhile, KEEMING offers related exposure to SLVEST’s project pipeline through its existing RM70m M&E subcontract from SLVEST subsidiary Atlantic Blue for a 99.99MWac solar plant in Bukit Selambau, Kedah.