Daily Market Reports Issued By Rakuten Trade Research : Page 16

Wall Street sell-down continues as sentiment was further eroded amid recessionary fears and the weaker than expected job data for July pushing unemployment rate higher to 4.3%.
As a result, the DJIA declined by 611 points while the Nasdaq lost 418 points as funds maintained the transition to bonds thus pushing the US 10-year yield to a YTD low at 3.799%.
In Hong Kong, the HSI declined to below the 17,000 level following the possible rough landing of the US economy despite of more potential rate cuts from the Federal Reserve going forward.
Back home, the FBMKLCI was not spared either as it dipped to just above the 1,610 mark amid a regional bloodbath.
We believe such drastic selling was just a knee-jerk reaction as traders may treat this as an excuse to lock in profits.
Nonetheless, we reckon overall sentiment may have turned cautious though we anticipate some bargain hunting to resurface albeit tentatively.
As such, we see the index to possibly hover within the 1,605-1615 range today.
Meanwhile, the good news is that the MYR has strengthened to RM4.50/USD1 or our year-end target.

Wall Street slumped as sentiment was spooked by the latest spate of economic data where many fears may be recessionary and not the soft landing that the Federal Reserve is striving for.
The higher than expected weekly initial jobless claims and lower manufacturing index saw the US 10-year yield dipped to 3.981% indicating that funds are shifting out of equities and into bonds.
Over in Hong Kong, the HSI closed marginally lower following the unexpected manufacturing activity data from China which shrank for the first time in 9 months.
Back home, the FBM KLCI ended slightly lower as sellers remained very much in the forefront.
Though surprised, we reckon prevailing unloading can also be attributed to the escalating tension in the middle east amid a regional weakness.
As such, we believe market undertone may have turned cautious after the sell-off on Wall Street thus anticipate the index to hover within the 1,620-1,630 range today.
Meanwhile, it is worthwhile noting that the MYR has strengthened to RM4.57/USD1 which is a YTD high against the greenback.

Wall Street closed on a positive note as sentiment was buoyed by dovish comments from the Federal Reserve on rate cuts as funds returned to the recently trashed mega tech companies.
As a result, the DJIA rose by almost 100 points while the Nasdaq surged by 452 points with the US 10-year yield easing to 4.032%.
As for Hong Kong, the HSI rebounded on hopes for more stimulus following a weak China’s manufacturing activity in July.
There are also hopes that there will be additional easing policies to enhance domestic demand in China as well.
Back home, the FBM KLCI uptrend gathered pace as buyers emerged in force during the afternoon session.
For today, we believe buying activities should continue, taking cue from the robust performance on Wall Street overnight thus expecting the index to hover within the 1,625-1,640 range.
Meanwhile, the heightening tension in the middle east has pushed crude oil prices higher with the Brent crude closing nearer to USD81/barrel.

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