Thu Sep 19 01:27:00 UTC 2024: ## KLCI Edges Up Despite Fed Rate Cut Uncertainty

**Kuala Lumpur:** The FBM KLCI rose modestly on Thursday, gaining 2.68 points to close at 1,663.27, despite the Federal Reserve’s overnight rate cut. While investors welcomed the cut, the mixed reaction on Wall Street, where gains were erased to end the session in the red, dampened the market’s enthusiasm.

The Fed’s larger-than-expected cut, a full 50 basis points, triggered concerns among some investors, leading them to question whether the central bank was acting out of fear for a slowing economy.

“This could raise concerns about a potential recession, or at least, suggest that the Fed anticipates weaker economic data ahead, prompting such a large rate cut,” stated Malacca Securities Research in its review.

However, US futures, particularly the tech-heavy Nasdaq mini, indicate a possible rebound in the coming session as investors factor in the lower lending rate for corporate earnings.

Locally, the focus is expected to shift towards REITs following the rate cut, according to Malacca Securities. The strengthening ringgit is also anticipated to benefit domestic sectors like consumer, utilities, financial, and automotive. The construction and property sectors are also seen as positive due to ongoing data center projects and the emerging catalyst from the Johor-Singapore Special Economic Zone.

On Thursday, AirAsia X and Capital A led the gains, with shares rising 6 sen and 5 sen respectively. Capital A’s EGM circular for the proposed disposal of its aviation business to AirAsia X was announced yesterday.

Solar District Cooling made its debut on the ACE Market, surging 12 sen to 50 sen and topping the actives list with 67.9 million shares traded by 9:22am.

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