TA Sector Research

Daily Brief - 28 Nov 2023

Publish date: Tue, 28 Nov 2023, 10:25 AM

Consolidate With Downside Bias

Bursa Malaysia shares fell into profit-taking consolidation on Monday, with investors refraining from more commitments amid worries over the health of China’s economy and pending more cues on the global inflation and interest rate trend. The FBM KLCI shed 5.77 points to close at 1,448.15, off an early high of 1,455.78 and low of 1,448, as losers swarmed gainers 683 to 287 on total turnover of 3.09nm shares worth RM2.05bn.

Better Supports at 1,430/1,400; Resistance at 1,465/1,470

The local market should extend consolidation with downward bias given the absence of positive domestic leads, and worries over the health of the global economy. On the index, better support is revised lower to 1,430, with 1,400/1,390 as stronger chart supports, while the end June low of 1,370 will act as crucial support. Immediate resistance is at 1,465/1,470, with the 1,490/1,500 area acting as tougher upside hurdle.

Bargain Genting Berhad & GENM

Genting Berhad need to overcome immediate resistance from RM4.70 and RM4.90 to enable a challenge of the March 2021 peak (RM5.13), with next major hurdle from the 123.6%FP (RM5.71), and key retracement supports at the 61.8%FR (RM4.20) and 50%FR (RM3.91). GENM need to climb above the 76.4%FR (RM2.74) to aim higher towards RM2.90 and retest the March 2021 high (RM2.96), with downside cushioned by the 50%FR (RM2.49) and 38.2%FR (RM2.38).

Asian Markets Dip Ahead of Key Economic Data

Shares in Asia traded lower on Monday as traders await key economic data from the China, U.S. and Europe later in the week for additional clues about the outlook for interest rates. This week, traders will be parsing Chinese activity data to gauge the health of the world’s second largest economy. China will release its official factory activity figures for November on Thursday, while the Caixin survey for the same metric will be out on Friday. Inflation readings in Australia and the Eurozone as well as personal consumption data in the US will also offer clues to the rate outlooks in their respective central banks. Fed Chair Jerome Powell will have a chance to push back against the doves at a Fireside Chat on Friday, and there are at least seven other Fed speakers on the docket this week.

Meanwhile, China’s industrial profits continued to shrink in November, but at its slowest pace in almost a year, according to data released by the government. In Japan, data showed service PPI rose 2.3% in October to its highest level since January 2020. Japan’s Nikkei 225 slipped 0.53%, closing at 33,447.67, while the Topix shed 0.38%, to 2,381.76. South Korea’s Kospi also dipped marginally to end at 2,495.66, while the small-cap Kosdaq was down 0.58% at 810.25. In Australia, the S&P/ASX 200 closed 0.76% lower at 6,987.60, and the Shanghai composite index fell 0.30% to 3,031.70.

Wall Street Slides as Traders Await Data, Policy Clues

Wall Street’s main indexes finished lower as markets look ahead to a key economic data reading and commentary from Federal Reserve policymakers later in the week. The Dow Jones Industrial Average fell 0.16% to 35,333.37. The S&P 500 lost 0.20% to finish the session at 4,550.43, while the Nasdaq Composite ticked lower by 0.07% to 14,241.02. The weakness on Wall Street comes as traders seem reluctant to make significant moves ahead of the release of some key economic data in the coming days. The Commerce Department's report on personal income and spending may be in the spotlight, as it includes readings on inflation said to be preferred by the Federal Reserve.

On latest economic data, new homes sold at a slower than expected pace in October while still showing improvement from a year ago, according to data from the Commerce Department. In Europe, European Central Bank President Christine Lagarde said the European Central Bank's fight to contain price growth was not yet done as wage growth was still strong and the outlook was uncertain, but she did point to easing euro zone inflation pressure. Among the 11 major sectors in the S&P 500, real estate and consumer discretionary were enjoying the largest percentage gains, while energy shares were down the most.

Source: TA Research - 28 Nov 2023

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