Daily Market Reports Issued By Rakuten Trade Research : Page 6

Wall Street ended mixed as market players took a breather following an action packed few days.
Focus is now on earnings primarily on the big tech companies that helped support the Nasdaq of late.
Meanwhile, the US 10- year yield edged higher to 4.542%.
As for Hong Kong, the HSI flew pass the 23,500 level as buyers returned buoyed by JD.com fastest earnings growth in 3 years rendering earnings expectations also grew for Tencent and Alibaba.
Overall sentiment was positive over the diminishing inflationary fears in the US plus the de-escalation of tension between the 2 superpowers.
On the home front, the FBMKLCI managed to close on a positive note albeit barely.
This can be attributed to the continuous bargain hunting by foreign funds of late as illustrated from the net foreign inflows of almost RM935m over the past 2 days.
As such, we believe the index may re-test the 1,600 mark soon thus expect it to hover within the 1,580-1,590 range today.

Wall Street closed mixed on differing news flow and the impacts.
While the Nasdaq and S&P500 jumped on the proposed USD600bn investments in Saudi Arabia, the DJIA was pressured by United Health’s 18% decline in its share price.
Meanwhile, the lower than expected CPI data for April saw the US 10-year yield staying flat at 4.471%.
Over in Hong Kong, the HSI experienced a sharp decline as traders took the opportunity to lock in profits amid concerns over the aftereffects of the 90 day tariff pause.
Back home, the FBM KLCI surpassed expectations by surging past the 1,580 level on optimism that the de-escalation of trade tension.
We believe the uptrend is fuelled by the flight of funds back to equities from bonds coupled with the inflow of foreign funds following their exodus since the beginning of this year.
In line with the crude oil inventory build-up, crude prices improved with the Brent crude hovering at almost the USD67/barrel level.

Wall Street soared after China and the US agreed to slash their tariffs for 90 days and temporarily reduced the tariffs to 10% and 30% for the US and China respectively.
While a runaway inflation in the US may have been averted, the US 10-year yield edged higher to 4.473%.
In Hong Kong, the HSI jumped by almost 700 points boosted by the potential de-escalation of trade tension between China and the US.
The local bourse will resume trading today following a lacklustre display last week.
We believe the FBM KLCI will play catch-up today.
As such, we expect the index to trend within the 1,550-1,570 range today.
Meanwhile, crude oil price rebounded as China is ramping up their purchases amid prevailing low prices.
As a result, the Brent crude jumped to around the USD65/barrel, which is a 2-week high.

Wall Street closed broadly higher after a trade deal is struck between the US and UK albeit with the lack of details.
Meanwhile, the US 10-year yield edged higher at 4.38%.
As for Hong Kong, the HSI managed to inch higher amid a lackluster session.
Sentiment remained cautious of the impending trade talk between the US and China.
Domestically, the FBM KLCI failed to maintain its uptrend as it closed just above the 1,540 level, possibly due to some profit taking activities illustrating that market undertone is still in a cautious mode.
Nonetheless, we are hopeful that Bank Negara’s (BNM) aggressive 1% cut in the Statutory Reserve Requirement (SRR) from 2% to 1%, the lowest in 14 years will spur market confidence.
However, we hope the banks will also play their part to be less stringent in loans approvals.
We view BNM’s latest move may encourage some buying interest on the banks and expect the index to hover within the 1,545-1,560 range today.

Wall Street closed on a positive note, albeit the Federal Reserve maintaining interest rates for the time being.
Citing the uncertain tariff impact on both inflation and unemployment, the Feds will wait for more data before making any move going forward.
Meanwhile, the US 10- year yield eased to 4.269%.
Over in Hong Kong, the HSI closed flat to just above the positive territory amid a lacklustre performance ahead of the US-China trade talk.
Nonetheless, traders are also hopeful that Beijing will look to cut both the Reserve Requirement Ratio and interest rates to further boost the equity market.
On the home front, the FBM KLCI closed at almost the 1,550 level courtesy from some late buying activities.
After 2 days of decline, we were surprised by the sudden U-turn possibly from the foreign funds that propped up the market.
Buying was centered mainly on the big cap laggards, and we believe these laggards will continue to play catch-up.
For today, we expect the index to hover between the 1,545-1560 range.

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