Market Reports

• Massive knee jerk reaction is happening all over the place mainly thanks to Trump’s bullying tactics. As mention numerous times, we remain positive and would use these as an opportunity to accumulate on blue chips.
• Banking stocks have had been sold down of late due to the cut in OPR coupled with the continuous exodus of foreign funds thus we believe it is excellent chance to look at banks namely Maybank, Public Bank, CIMB and Hong Leong Bank.

• It is going be a volatile few days for equities and the Ringgit in view of the US tariff warning on China and the recent reduction in our OPR (overnight policy rate). Nonetheless, we remain positive on the equity market primarily due to the “push” by the government as seen recently.
• We believe the government is now seriously looking to improve the ailing domestic economy and that the impending implementation of the mega projects as to kickstart their initiatives and expect more in the offing.

• As predicted, Bank Negara Malaysia Monetary Policy Committee has cut overnight policy rate (OPR) by 25 basis points to 3% making the first easing in almost three years.
• This is a good move by BNM in view of increasing signs of slowdown in global and domestic economic activities. The rate cut is expected to provide relief and lowers borrowing cost for individuals and many businesses.
• Our stock market stands to benefit from the rate cut hence investors should take the opportunity to selectively buy on weakness in the current market. 

• Dow Jones Industrial staged a rebound to close off its low from -460 point to -66 points when news of China delegation will proceed to meet in Washington to discuss on trade deal and crude oil price has also rebounded to close above USD71/barrel.
• A such, we can expect O&G related stocks to benefit such as our technical pick today Barakah Offshore and Straits Inter Logistic where both have positive news announced (Refer to our technical view for more details).

Trump is at it again threatening to double tariffs on US$200bn of Chinese goods plus new import taxes. Such moves will again derail the stability of both the equity and treasury markets as we expect some knee jerk reactions to such developments.

• We can expect some weaknesses on the local bourse couple with lower Ringgit against the US$.
• We advise investors to accumulate on Blue Chips if and when the FBM KLCI dips below the 1,620 level.