Daily Market Report - 20 Feb 2025
- Wall Street closed modestly higher as traders shrugged off hawkish statements from the Federal Reserve on inflation and interest rates.
- In view of the ongoing tariff spree from Trump, the Fed is concern of the subsequent impact on inflation.
- Meanwhile, Trump may impose 25% tariff on imports of automobiles, pharmaceuticals and semiconductors.
- Nonetheless, the US 10-year yield eased slightly to 4.535%. In Hong Kong, the HSI is still suffering from some indigestion as it closed marginally lower.
- This is normal following its astronomical rise of around 15% gain YTD.
- On the home front, the performance of the FBM KLCI is still disappointing as it ended lower at the 1,580 level.
- We suspect foreign funds may be realigning their portfolio out of ASEAN and shift to the Hong Kong market for now.
- Therefore, we expect this downtrend to be temporary as we believe more funds will re-direct their interests out of Wall Street to Asia, hence the spillover effect on the rest of the region.
- For today, we expect the index to hover within the 1,580-1,590 range.
