rakuten trade market reports : Page 19

Expectations of further cuts in crude oil production may see oil prices to trend higher which in turn will spur production of bio fuel. While Brent price has climbed to almost US$64/barrel, CPO has also trended higher at almost RM2,775/MT.
These may induce buying interests to centre on both the Oil & Gas and some Plantation companies. Following yesterday’s positive close for the FBM KLCI, we expect the buying momentum to persist albeit at a slower pace.
Expect the FBM KLCI to test the 1,570 level today.

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So far, updates over the US China trade talk has been unilateral predominantly from Trump. Until more concrete evidence are out, we would rather ignore his statements for now and expect market volatility to ensue.
Nonetheless, we anticipate regional markets to take cue from yesterday’s rebound from Wall Street thus may see some bargain hunting channelling in especially on the local bourse.
Therefore, we would envisage the FBM KLCI to possibly test the 1,565 mark thereafter the 1,570 level for today.

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Trusting Trump to come clean on the US China trade talk is likened to the sun rises from the west. As it is, global equity markets are again roiled by the diminishing hopes of any agreement between the US and China.
Looks like we may have to endure the stalemate till 2020 amid heightened market volatility.
We are indeed surprised by the way foreign funds are shunning Malaysia as we are indeed heading towards a more positive direction next year. With corporate earnings estimated to grow above 6% in 2020, valuations on the local bourse seems to be very reasonable.
Based on 1,560 the FBM KLCI is trading on a market PER of below 15x which is deem highly attractive. Therefore, we maintain our view that foreign funds would return anytime soon.
For today, we expect the benchmark index to test 1.560 before rebounding towards the 1,565 mark.

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As suspected, the US China trade talk will never be resolved amicably as Trump continues to use his dirty tactics to prolong our sufferings. Meanwhile, he is also looking to impose tariffs at certain European countries making him the most popular person in the world at this instance.
With uncertainties abound, we will be forced to ride the volatility wave again hence may see some downside bias on regional markets today.
Though the FBM KLCI downside should be capped with immediate support at 1,560, we continue to see the lack of participation from the foreign funds over the immediate term.

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The FBM KLCI broke all immediate support levels last Friday following what we suspected were rather drastic selling from the foreign funds.
Amid prevailing uncertainties over the US China trade talk, regional weaknesses and fresh portfolio realignments amongst the foreign funds we reckon the local bourse may continue to experience volatility ahead.
Nonetheless, we anticipate there to be some bargain hunting activities today hence may see the FBM KLCI to trend higher with immediate resistance at the 1,570 mark.

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