Timber Related Stocks May See Improved Trading Activities After Malaysia Forging Ties With Vietnam

Timber-related stocks may see improve trading activities after Malaysia and Vietnam have signed a Memorandum of Cooperation (MoC) to further develop the timber trades between both countries, Malacca Securities said in a note.

 Meanwhile, it said that the technology sector may rebound, taking a cue from the positive developments on Nasdaq overnight.

Following the conclusion of the two-day US FOMC meeting that saw the pace of the interest rate hike coming in line with market expectations, the stockbroking firm said that market conditions should turn calmer.

It said that mild bargain hunting activities may emerge at least for the near term after the majority of the stocks have fallen into the oversold territory.

Still, it said it reckons that the lack of fresh market catalysts and anxieties over the lingering inflationary pressure could result in the market environment remaining wary and cautious over time, which may keep the upside limited. Meanwhile, the Brent oil price has declined below USD120, while the CPO is trading around RM5,600.

On the local bourse, Malacca Securities said that the FBM KLCI (-1.5%) erased all its previous session gains alongside the mostly weaker regional peers yesterday.

It said that the lower liners retreated on quick profit-taking activities, while all the 13 major sectors on the broader market fell with the plantation sector (-2.2%) being the biggest underperforming sector.

On the global markets, Wall Street rebounded overnight as the Dow (+1.0%) rose after the US Feds delivered a 75 basis point interest rate hike and re-assured that similar large rate hikes may be off the table for now in the upcoming FOMC meeting. The European stock markets rebounded, but Asia stock markets closed mostly lower.

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