Mild Window Dressing Ahead of Year End

The local blue-chip benchmark ended firm on Tuesday, lifted by modest bargain hunting in key energy and utility heavyweights while the broader market consolidated ahead of the Christmas holiday break. The FBM KLCI added 6.79 points to close at 1,602.99, off an opening low of 1,596.64 and high of 1,603.89, as losers edged gainers 500 to 427 on muted trade totaling 2.01bn shares worth RM1.54bn.

Resistance at 1,626/1,648; Support at 1,588/1,565

Most stocks should stay range bound broadly while mild window dressing interest lift selective key index heavyweights ahead of the year-end holidays. Immediate index resistance remains at 1,626, next 1,648, followed by the September peak of 1,675. Immediate support stays at 1,588, the 38.2%FR of the 1,529 low (6 Aug) to 1,684 high (29 Aug) rally, with stronger key supports at 1,565, the 23.6%FR level, and then 1,550.

Bargain Gadang & IWCity

Gadang is in base building mode, with key chart supports from the lower Bollinger band (30sen) and 26/5/23 low (28sen) cushioning downside, while a breakout from consolidation above the 23.6%FR (34sen) should aim for the 38.2%FR (37sen) and 50%FR (40sen) ahead. Similarly, IWCity has key supports at the lower Bolinger band (54sen) and 11/9/24 low (47sen) restricting downside, with a confirmed breakout above the 76.4%FR (60sen) to target the 61.8%FR (68sen) and 50%FR (75sen) going forward.

Japan Gain Led by Auto Sector, Most Markets Closed for Holidays

Japan’s Nikkei share average reversed early losses to end higher on Wednesday, driven by gains in the auto sector although trade was dominated by retail investors, who bought back cheap stocks in muted trade with many global markets closed for the holidays. The Nikkei rose 0.24% to close at 39,130.43 after falling as much as 0.28% earlier in the session. The auto sector rose 2.9% and was the best performer among the Tokyo Stock Exchange’s 33 industry sub-indexes. Nissan Motor, the Nikkei’s top percentage gainer, surged 8.66%. The broader Topix also erased losses to end 0.24% higher, at 2,733.86. Toyota Motor, which closed 4.57% higher, was the biggest contributor to the Topix rise. Technology investor SoftBank Group rose 1.27% and was the biggest source of support for the Nikkei. The market struggled to find direction with foreign investors away for the holiday season. Bank shares fell, with Mitsubishi UFJ Financial Group falling 0.44% and Sumitomo Mitsui Financial Group down 0.56%.

Meanwhile, China stocks edged down on Wednesday, dragged by small-cap shares, as thematic concept sectors pulled back. China’s blue-chip CSI300 Index dropped 0.1% by the lunch break, while the Shanghai Composite Index was down 0.3%. The CSI 2000 index, which tracks smallcap stocks, fell 2.7%. Financial markets in Hong Kong will be closed through Thursday for the year-end holidays.

Wall Street Rose on Christmas Eve, Tech Stocks Lead

US stocks jumped Tuesday on Christmas Eve as the market pulled off back-to-back gains in the holiday week. The S&P 500 added 1.1% to 6,040.04, and the Dow Jones Industrial Average gained 390.08 points, or 0.91%, to 43,297.03. The Nasdaq Composite climbed 1.35% to 20,031.13, helped by a 7.4% jump in Tesla shares. Amazon and Meta Platforms gained more than 1% each. The New York Stock Exchange closed early for Christmas Eve, while the bond market closes at 2 p.m. The market is also shut on Wednesday for Christmas Day. Tuesday marked the start of the seasonal Santa Claus rally, which happens in the last five trading days of the year and the first two in January.

Since 1950, the S&P 500 has generated an average return of 1.3% during this period, widely outpacing the market’s average seven-day return of 0.3%, according to LPL Research. With two straight winning days, the S&P 500 is up 1.8% this week, while the Dow has gained about 1%. The strong rally in megacap tech lifted the Nasdaq up 2.3% week to date. The S&P 500 also turned green for the month with a 0.1% gain after this week’s advance. The tech-heavy Nasdaq has rallied 4.2% in December, with Google parent Alphabet up 16%, Apple up nearly 9% and Tesla rallying about 34% month to date. The blue-chip Dow, however, is still down about 3.6% in December, on pace for its worst monthly performance since April.

Source: TA Research - 26 Dec 2024