24 November Weekly Market Recap

5 min read     I     Date: 27 November 2023

Market Data

Asset Class   Curr 1-wk 1-mth YTD 2022

MSCI World  


1.0% 7.6% 15.8% -19.5%
S&P 500   USD 1.0% 7.3% 18.7% -19.4%
Nasdaq   USD 0.9% 8.4% 46.1% -33.0%
Stoxx 600-Europe   EUR 0.9% 5.7% 8.3% -12.9%
MSCI Asia Pac ex-Japan   USD 0.6% 5.7%


ASEAN   USD -0.9% 2.5% -4.2% 2.4%
Shanghai Shenzhen CSI 300 Index   CNY -0.8% 1.5% -8.6% -21.6%
Hang Seng Index   HKD 0.6% 3.3% -11.2% -15.5%
Shanghai Stock Exchange Composite Index   CNY -0.4% 2.7% -1.6% -15.1%
FBMKLCI   MYR -0.5% 1.3% -2.8% -4.6%

Fixed Income
Bberg Barclays Global Agg Index   USD 0.2% 3.5% 0.4% -16.2%
JPM Asia Credit Index-Core   USD 0.3% 3.5% 5.3% -13.0%
Asia Dollar Index   USD 0.4% 2.0% -2.6% -6.9%

Top Performing Principal Funds
(1 month return as of 31 October 2023)
Principal Global Multi Asset Income Fund - Class MYR       -0.6% 2.3% -11.8%
Principal DALI Equity Growth Fund       -0.8% -0.3% -9.5%
Principal Commodity Fund - Class USD       -0.9% -5.0% nil
Fixed Income            
Principal Asia Dynamic Bond Fund - Class MYR       0.5% 2.9% -4.7%
Principal Money Market Income Fund - Class AI       0.3% 0.2% 0.9%
Principal Islamic Deposit Fund - Clas AI       0.3% 3.0% 2.2%


Source: Bloomberg, market data is as of 24 November 2023.
*As we emphasise a long-term focus, the top performing funds were selected based on their monthly performance.
*The numbers may show as negative if there is no positive return for the period under review.
*Past performance is not an indication of future performance.                    

Market Review1

  1. Global financial markets wrapped up the week on a positive note, with The United States (US) leading the gains among the developed markets, followed by Europe and Japan.

  2.  Across Asia, the performances were mixed across the markets, with Korea and the Philippine leading the way, while China offshore and Thailand declined the most. 

  3. In Malaysia, the FBMKLCI in Malaysia ended the week on a muted note, fuelled by cautious sentiment in the regional market. 

  4. Turning to bond market, the price of the 10-year U.S. Treasury note closed on a marginal negative note, with yields stabilising around the 4.40% range after hitting a two-month low. The shift was driven by the recent market expectation that the U.S. Federal Reserve’s (Fed) rate-hiking campaign may have come to an end. (Bond prices move in the opposite direction of bond yields)

Macro Factors

  1. In the US, the latest Fed minutes show no new signals on the interest rate decision. The initial jobless data dropped sharply, surpassing expectation, indicating the labour market slowdown hasn’t fully materialised. October’s home sales data weakened by 4.1% compared to the previous month possibly due to high mortgage rates. Additionally, the October S&P Global US Manufacturing and Servies PMI had mixed results, with manufacturing decelerating to 49.4 while services expanding to 50.8 (a reading below 50 indicates contraction). 2

  2. In Europe, the HCOB Eurozone Manufacturing and Services PMI exceeded expectation at 43.8 and 48.2, respectively, but still indicated contraction as both remained below 50. On the monetary policy front, the European Central Bank reiterated their stance to keep options open for another interest rate hikes to bring inflation down to their 2% targeted level.3

  3. In China, the People's Bank of China (PBoC) maintained lending rates at the November fixing. The one-year loan prime rate (LPR), which is the medium-term lending facility used for corporate and household loans, was left unchanged at a record low of 3.45%; and the five-year rate, a reference for mortgages, was kept at 4.2% for the fifth straight month. The decision came after the central bank held medium-term interbank rates steady as economic activity in October was mixed, with headwinds from the property sector deepening despite a slew of stimulus measures from authorities.4

Investment Strategy5

Our current stance is neutral on both equity and fixed income, with a preference for income-focused funds. Our strategy emphasises quality, growth, and income in stocks and credits. We are exercising caution with USD assets and believe that Asian equities and fixed income present more value in the short term.

  1. We find bonds appealing as we perceive a higher likelihood that central bank hiking cycle will end soon. We also see potential for capital gains in the event of weaker economic growth. Therefore, we maintain our preference for investment grade bonds with longer durations as our preferred investment choice. For Malaysia, the projected improvement to the budget deficit, provided in the Budget 2024, improved the outlook for domestic bonds.
  2. On equities, we prefer quality and dividend-paying stocks for their defensive characteristics, which can provide resilience in the face of uncertain macroeconomic and geopolitical conditions. Our positive outlook is focused on Asia and includes strategic positions in various areas: a) the bottoming tech hardware cycle, b) long-term growth potential driven by low penetration rates (such as India), c) recovery plays and structural themes in ASEAN, d) selective sectors benefiting from China's reopening, and e) Malaysia's growing optimism due to political stability and potential gains from the New Energy Transition Roadmap, the New Industrial Master Plan 2030 and projected improvement to the budget deficit detailed in the Budget 2024.
  3. We also favour income-focused approach to ride out volatilities arising from geopolitical tensions, inflationary issues, and recessionary concerns.  



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1 Bloomberg, 24 November 2023 
2 Bloomberg, Bureau of Labor Statistics (BLS), ISM, S&P Global, US Federal Board, 24 November 2023
3 S&P Global, ECB, Factset, Bank of England (BoE), 24 November 2023
4 Bloomberg, National Bureau of Statistic China, 24 November 2023
5 Principal view, 24 November 2023


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Disclaimer: We have based this document on information obtained from sources we believe to be reliable, but we do not make any representation or warranty nor accept any responsibility or liability as to its accuracy, completeness, or correctness. Expressions of opinion contained herein are those of Principal Asset Management Berhad only and are subject to change without notice. This document should not be construed as an offer or a solicitation of an offer to purchase or subscribe or sell Principal Asset Management Berhad’s investment products. The data presented is for information purposes only and is not a recommendation to buy or sell any securities or adopt any investment strategy. This material is not intended to be relied upon as a forecast, research, or investment advice regarding a particular investment or the markets in general, nor is it intended to predict or depict performance of any investment. We recommend that investors read and understand the contents of the funds’ prospectus and product highlights sheet available on the Principal website, which have been duly registered with the Securities Commission Malaysia (SC). Registration of these documents does not amount to nor indicate that the SC has recommended or endorsed the product or service. There are risks, fees and charges involved in investing in the funds. You should understand the risks involved, compare, and consider the fees, charges and costs involved, make your own risk assessment, and seek professional advice, where necessary. This article has not been reviewed by the SC.