Daily Market Report (7 May 2024)
- Wall Street maintained its uptrend on hopes that the Federal Reserve will cut rates sooner rather than later.
- Sentiment was further boosted by Hamas’ acceptance an Egyptian-Qatari cease fire proposal against Israel.
- As such, the DJI Average gained 177 points while the Nasdaq jumped by 193 points with the US 10-year yield easing further to 4.487%.
- Over in Hong Kong, the HSI almost tested the 19,000 mark as sentiment was buoyed by strong Chinese travel data coupled with upgrades by Goldman Sachs, UBS and BNP Paribas.
- Back home, the FBM KLCI closed within touching distance of 1,600 mark and almost a 52-week high as buying in blue chips continues.
- The benchmark index has had an impressive performance since mid-April, adding 4% as foreign funds returned.
- Judging the prevailing uptrend, our 2024 target of 1,660 could be easily achievable as the local bourse remains reasonably priced currently at 15x CY24 PE vis-a vis the 16x average.
- In view of this, we believe funds into the Blue Chips will eventually cascade down to the smaller caps thus expect Round 2 from small cap companies to excel.
