Resurgence of the virus is now being experienced across the world as cases spike, leaving global economies scrambling to put in place measures to contain the spread. Tech-related stocks are again in the limelight, with Apple Inc's stock price rising steadily after the unveiling of the new iPhone 12. Ongoing uncertainties left global equities to end the week mixed, with stock prices in US and China climbing higher whilst most other major Asian indices, along with the European market losing ground.
In the News
- The rapid rise in the resurgence of the virus has left many facing the rising possibility of a lockdown. Cases now stand at 38.9 million, with more than 1 million fatalities from the pandemic.
- The US saw its highest daily numbers when more than 60,000 cases were reported in a single day.
- US equities, which had seen a boost in the previous week from optimism of a possible stimulus package, managed to eke out marginal gains as little progress was seen on the stimulus front.
- Hopes of a vaccine was dampened when trials being carried out by Johnson & Johnson’s, and Eli Lilly were halted after its antibody treatment resulted in adverse reactions for testers. News that Pfizer was preparing to seek emergence authorisation for its vaccine did, however, lift markets at the end of the week.
- US corporates have started to release their 3rd quarter earnings results, and analysts are expecting many across the S&P to report a 20% decline in earnings due to the pandemic effect.
- The release of Apple Inc’s iPhone 12 helped push the company’s stock price higher, contributing to the better performance of the tech-sector last week. The NYSE FANG+ Index, which tracks the performance of 10 of the largest US tech names, rose 1.32% last week, pushing the 0830EA to see a gain of 1.97% over the same period.
- European equities tumbled on the back a spike in pandemic cases, and the increasing possibility of a no-deal Brexit.
- Tighter movement controls have already been put in place in a bid to avoid a lockdown that could further impact the economy.
- China equities roared back into the market after its 8-day long Golden Week holiday. The Shanghai Composite, and the CSI 300 Index both rose 2.18%, and 2.58% respectively. The S&P New China Ex A Share Index also climbed alongside the broader China market, gaining 1.09% over the week, benefitting from the strong run in tech-related names. The 0829EA, which tracks the Index, rose 1.22% over the week to bring its YTD gains to 29.6% in MYR terms.
- Sentiment for the China market remains strong, with the September trade data reinforcing the belief that China’s economy is, in fact, back on track. IMF is forecasting China to see a full year GDP growth of 1.9%, whilst the rest of the world faces economic contraction.
- On the local front, politics and rising pandemic cases have stolen the limelight. However, local momentum stocks did manage to rise over the week despite the uncertainties that led to the KLCI sliding 1.73% lower. The Dorsey Wright Technical Leaders Malaysia Index climbed 0.51% to push the 0836EA to rise 0.62% over the same period.
- The on-going uncertainties have kept Gold price to remain steady above the USD1,900 per ounce level. The 0828EA, which tracks the performance of Gold price, rose marginally higher as investors turned towards safe haven assets amidst rising uncertainties. The 0828EA ended the week at MYR2.5433 per unit after inching 0.18% higher last week.
On the Economic Data Front
- US jobless claims return to a high:
- Weekly jobless claims rose to a 2-month high of 898,000.
- Continued claims did however reduce from 11.2 million, to 10.1 million.
- Core CPI rose 0.2% in September – said to be attributed by the increased usage of vehicles amidst the pandemic.
- Retail sales rose above expectations to 1.9% – a 5th consecutive monthly increase.
- Industrial production fell 0.6% – dragged down by weakness in the vehicle, and electronics segment.
- China’s trade data boosts confidence:
- Export numbers grew 9.9% YoY in September, rising for the 4th consecutive month.
- Import numbers also rose, pointing towards a recovery in domestic demand.
ETF strategies at TradePlus
A look at the performance of the TradePlus ETFs, and major global indices
Learn more about TradePlus ETFs
Disclaimer: This article has been prepared by AHAM Asset Management Berhad (“AHAM Capital”) specific for its use, a specific target audience, and for discussion purposes only. All information contained within this presentation belongs to AHAM Capital and may not be copied, distributed or otherwise disseminated in whole or in part without written consent of AHAM Capital. The information contained in this presentation may include, but is not limited to opinions, analysis, forecasts, projections and expectations (collectively referred to as “Opinions”). Such information has been obtained from various sources including those in the public domain, are merely expressions of belief. Although this presentation has been prepared on the basis of information and/or Opinions that are believed to be correct at the time the presentation was prepared, AHAM Capital makes no expressed or implied warranty as to the accuracy and completeness of any such information and/or Opinions. As with any forms of financial products, the financial product mentioned herein (if any) carries with it various risks. Although attempts have been made to disclose all possible risks involved, the financial product may still be subject to inherent risk that may arise beyond our reasonable contemplation. The financial product may be wholly unsuited for you, if you are adverse to the risk arising out of and/or in connection with the financial product. AHAM Capital is not acting as an advisor or agent to any person to whom this presentation is directed. Such persons must make their own independent assessments of the contents of this presentation, should not treat such content as advice relating to legal, accounting, taxation or investment matters and should consult their own advisers. AHAM Capital and its affiliates may act as a principal and agent in any transaction contemplated by this presentation, or any other transaction connected with any such transaction, and may as a result earn brokerage, commission or other income. Nothing in this presentation is intended to be, or should be construed as an offer to buy or sell, or invitation to subscribe for, any securities. Neither AHAM Capital nor any of its directors, employees or representatives are to have any liability (including liability to any person by reason of negligence or negligent misstatement) from any statement, opinion, information or matter (expressed or implied) arising out of, contained in or derived from or any omission from this presentation, except liability under statute that cannot be excluded.
Warning Statement: A copy of the Prospectus / Supplemental Prospectus for the TradePlus Shariah Gold Tracker and TradePlus S&P New China Tracker, the Prospectus for the TradePlus DWA Malaysia Momentum Tracker and TradePlus MSCI Asia Ex Japan REITs Tracker, as well as the Master Prospectus for the TradePlus NYSE® FANG+™ Daily (2x) Leveraged Tracker, TradePlus NYSE® FANG+™ Daily (-1x) Inverse Tracker, TradePlus HSCEI Daily (2x) Leveraged Tracker and TradePlus HSCEI Daily (-1x) Inverse Tracker (collectively known as the “TradePlus L&I ETFs”) can be obtained at Affin Hwang Asset Management's (“AHAM Capital”) website at www.tradeplus.com.my. Investors are advised to read and understand the contents of the Prospectus dated 28 November 2017 and Supplemental Prospectus dated 2 July 2019 (for TradePlus Shariah Gold Tracker), Prospectus dated 15 January 2019 and Supplemental Prospectus dated 2 July 2019 (for TradePlus S&P New China Tracker), Prospectus dated 9 July 2020 (for TradePlus DWA Malaysia Momentum Tracker), Prospectus dated 9 July 2020 (for TradePlus MSCI Asia Ex Japan REITs Tracker), as well as the Master Prospectus dated 26 November 2019 (for the TradePlus L&I ETFs) before investing. There are fees and charges involved when investing in the funds stated herein. Investors are advised to consider and compare the fees and charges as well of the risks carefully before investing. Investors should make their own assessment of the risks involved in investing and should seek professional advice, where necessary. The price of units and distribution payable, if any, may go down as well as up and past performance of the funds should not be taken as indicative of their future performance. The Securities Commission Malaysia has not reviewed this material and takes no responsibility for the contents of this material and expressly disclaims all liability, however arising from this material.
You may refer to the relevant Licensing Disclosure Statement & Conditions at the respective webpages for each fund available on www.tradeplus.com.my.