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Author: MalaccaSecurities   |   Latest post: Fri, 14 Dec 2018, 03:05 PM

 

M+ Online Technical Focus - 14 Dec 2018

Author: MalaccaSecurities   |  Publish date: Fri, 14 Dec 2018, 03:05 PM


Tracking the overnight gains on Wall Street, the FBM KLCI extended its gains to close above the EMA9 level as the key index close at around the 1,676.00 level yesterday. The MACD Histogram has extended another green bar, but the RSI remains below 50. Resistance will be pegged around the 1,700-1,710 levels. Support will be set around the 1,660 level.\

CCMDBIO has gapped-up to close above the EMA20 line with improved volumes. The MACD Indicator has issued a BUY Signal, while the RSI is approaching 50. Monitor for a breakout above RM1.08, targeting the RM1.16 and RM1.25 levels. Support will be set around the RM1.02 level.

TRC has rebounded to retest the EMA120 level. The MACD Histogram has turned green, but the RSI remains below 50. Monitor for a breakout above RM0.505, targeting the RM0.555-RM0.605 levels. Support will be anchored around the RM0.47 level.

SERBADK has advanced to close above the EMA120 level with rising volumes. The MACD Histogram has extended another green bar, while the RSI is approaching 50. Monitor for a trendline breakout above the RM3.80 level, targeting the RM4.06-RM4.29 levels. Support will be pegged around the RM3.60 level.

Source: Mplus Research - 14 Dec 2018

Labels: CCMDBIO, TRC, SERBADK
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Mplus Market Pulse - 14 Dec 2018

Author: MalaccaSecurities   |  Publish date: Fri, 14 Dec 2018, 08:56 AM


Continuing Recovery

  • Tracking the positive sentiment on Wall Street overnight, the FBM KLCI (+0.8%) extended its gains yesterday, boosted by the potential easing of the U.S.-China trade tension. The lower liners – the FBM Small Cap (-0.3%), FBM Fledgling (-0.3%) and FBM ACE (-1.6%), however, extended their losses after erasing their intraday gains, while the broader market closed mostly higher.
  • Market breadth turned negative as decliners edged advancers on a ratio of 397-to-371 stocks. Traded volumes slipped 24.2% to 1.57 bln shares as investors remain wary on the recent market volatility.
  • More than two-thirds of the key index’s constituents advanced, led by Nestle (+90.0 sen), followed by Petronas Dagangan (+66.0 sen), Hong Leong Bank (+28.0 sen), Hong Leong Financial Group(+28.0 sen) and Malaysia Airport Holdings (+20.0 sen). Anchoring the advancers on the broader market were Fraser & Neave (+88.0 sen), Panasonic (+28.0 sen), Genting Plantations (+25.0 sen), Khind Holdings (+22.0 sen) and Heineken (+14. sen).
  • Meanwhile, significant decliners on the broader market include Ajinomoto (-28.0 sen), BAT (-24.0 sen), Tasek Corporation (-15.0 sen), Heng Yuan (-13.0 sen) and Westports (-12.0 sen). There were only three decliners on the key index – Hartalega (-9.0 sen), Tenaga (-4.0 sen) and Dialog (-1.0 sen).
  • Asia benchmark indices remain upbeat on the positive trade developments between U.S. and China as the Nikkei added 1.0%, while the Hang Seng rose 1.3%. The Shanghai Composite climbed 1.2% on expectations of further policymeasures to address the economic slowdown. ASEAN stockmarkets, meanwhile, closed mostly higher yesterday.
  • U.S. stockmarkets finished mixed overnight with the Dow gaining 0.3% as investors digested the latest developments on U.S.-China trade spat. On the broader market, the S&P 500 and Nasdaq, however, fell 0.02% and 0.4% respectively after erasing all their intraday gains.
  • Earlier, European equities – the FTSE (- 0.04%), CAC (-0.3%) and DAX (-0.04%), all retreated after enduring a choppy trading session. Meanwhile, the European Central Bank (ECB) formally ended Quantitative Easing program that pumped in €2.6 trn into the European economy over the past four years in order to stoke growth and inflation.

THE DAY AHEAD

  • While selective stocks on Bursa Malaysia continue to make headway yesterday, the buying remained selective and on low volumes. As it is, investor interest has yet to return in full as most market players are still wary of the underlying market environment, judging by the lack of market following in the ongoing recovery.
  • Although the uptrend looks to continue that will allow the key index to end the week on a positive note - in tandem with the sustained positivity in overseas markets, we think the buying will remain selective. Gains will still be concentrated on the big cap stocks, while the broader market stocks will continue to drift due to the lack of following. Hence, we see the key index re-challenging the 1,680 level, before heading to the 1,690 resistance. The supports are at 1,670 and 1,650 respectively
  • Meanwhile, there remains little reprive for the lower liners and broader market shares as they continue to head south amid the thinning interest from retail players. Although the indices are oversold, there are still few signs of a rebound as yet and the downside bias remains for now.

COMPANY BRIEF

  • RHB Bank Bhd has obtained Bank Negara Malaysia’s approval to establish a subsidiary in Vietnam, following its unit, RHB Investment Bank’s proposed acquisition of the remaining 51.0% equity interest in Vietnam Securities Corp that it does not already hold for 121.63 bln dong (RM21.7 mln) in cash. (The Edge Daily)
  • Utusan Melayu (Malaysia) Bhd executive Chairman Datuk Abd Aziz Sheikh Fadzir has resigned just six months after being appointed to the post, due to personal reasons.
  • To recap, the latter was appointed as executive Chairman on 7th June, 2018, replacing Tan Sri Mohamad Fatmi Che Salleh, who along with four other directors had resigned due to changes in the Umno leadership after Barisan Nasional’s loss in the 14th general election. (The Star Online)
  • Can-One Bhd plans to buy another 2.2 mln shares (or 0.5% equity stake) in Kian Joo Can Factory Bhd and will subsequently extend a mandatory general offer to the minority shareholders of Kian Joo at an offer price of RM3.10 per share.
  • Consequently, Can-One has inked a conditional share sale agreement with Tan Kim Seng for the remaining stake in Kian Joo, which will increase the group’s ownership in Kian Joo to 33.4%, from32.9% presently. (The Star Online)
  • Pasukhas Group Bhd has proposed to establish an Islamic Medium Term Note Programme of RM200.0 mln in nominal value to fund its acquisitions and capex needs.
  • The programme will be established under the syariah principle of Wakalah Bi AlIstithmar together with Murabahah, will have a tenure of 20 years from the date of its first issuance, while proceeds will be used to finance Pasukan Green’s acquisitions of projects, which may include a company, and to fund its working capital needs. (The Edge Daily)
  • Petronas Dagangan Bhd (PDB) has appointed its head of retail business, Aadrin Azly, as the group’s new Chief Operating Officer, effective 1st January, 2019. (The Edge Daily)
  • Malayan United Industries Bhd (MUI) has announced the resignation of Tan Sri Khoo Kay Peng as the group’s executive Chairman after more than four decades of helming the company, and will be replaced by his son Andrew Khoo Boo Yeow.
  • Andrew had been appointed by its board of directors as their executive Chairman after assuming the role of group Chief Executive Officer on 1st January, 2019. (The Star Online)
  • Vertice Bhd is planning to dispose 60.0% stockholding in its fashion retail business to its founder and executive deputy Chairman Seow Khim Soon for RM32.6 mln.
  • Following an agreement signed on 13th December, 2018, Seow will be relinquishing his directorship in the group to concentrate his efforts on managing the fashion retailing business parked under Kumpulan Voir Sdn Bhd, and toavoid any potential conflict of interests.
  • Upon completion of the disposal, which will see Kumpulan Voir becoming Vertice’s 40.0% associated company, Vertice will also continue to provide corporate guarantee to the banking facilities procured by Kumpulan Voir. (The Edge Daily)
  • SCGM Bhd‘s 2QFY19 net profit plunged 68.6% Y.o.Y to RM1.7 mln, from RM5.3 mln a year ago, due to higher resin prices, finance cost as well as increased operating expenditure incurred by both its old and new plants in Johor. Quarterly revenue, however, rose 10.2% Y.o.Y to RM57.4 mln, from RM52.1 mln a year ago and the group declared a second interim dividend of 0.5 sen per share, payable on 18th January, 2019.
  • Consequently, cumulative 1HFY19, net profit also narrowed 75.0% Y.o.Y to RM2.7 mln, compared to RM10.9 mln previously, although revenue climbed 7.1% Y.o.Y to RM113.2 mln, from RM105.8 in 1HFY18. (The Edge Daily)
  • AirAsia Group Bhd has received "no less than 13 expressions of interest and also offers" from prospective buyers, including US private investment firm Castlelake LP, for its aircraft leasing unit and a number of its remaining aircraft assets.
  • The group, however, has not entered into any legally binding contract with any of the parties involving the sale of the leasing unit or a significant number of aircraft, "with values over and above the prescribed thresholds under the Main Market Listing Requirements of Bursa Malaysia Securities Bhd". (The Edge Daily)
  • Eco World Development Group Bhd's (EcoWorld) 4QFY18 net profit doubled to RM68.5 mln, from RM33.7 mln, despite a 32.8% Y.o.Y drop in quarterly revenue toRM607.6 mln, from RM904.1 mln last year. The improved bottomline was mainly due to completion of some major projects and delivery of a significant number of completed property units to customers by subsidiaries.
  • Full year net profit also fell 21.0% Y.o.Y to RM165.6 mln, from RM209.7 mln in the last corresponding period, while its revenue lost 26.0% Y.o.Y to RM2.17 bln, from RM2.94 bln in FY17. (The Edge Daily)
  • Eco World International Bhd (EWI) aims to acquire land in London to build an additional 5,000 built-to-rent (BtR) homes over the next five years. This comes on top of 12 existing sites in London with the potential to deliver some 4,000 units. (The Edge Daily)
  • Perdana Petroleum Bhd is planning to abort its previously proposed private placement to raise up to RM109.0 mln, which was first announced in May 2017.
  • The decision to scrap the plan comes after taking into consideration its ongoing corporate debt restructuring exercise under Bank Negara Malaysia, as well as the prevailing weak market conditions of the past six months. (The Edge Daily)
  • JAKS Resources Bhd saw its rights issue of warrants undersubscribed by 62.5%, although it still managed to meet its minimum subscription level and raised gross proceeds of RM25.6 mln. That means a take-up rate of only 37.5% or 102.4 mln of the total 273.0 mln rights warrants available for subscription. (The Edge Daily)

Source: Mplus Research - 14 Dec 2018

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Mplus Market Pulse - 13 Dec 2018

Author: MalaccaSecurities   |  Publish date: Thu, 13 Dec 2018, 09:41 AM


Continuing Recovery

  • The FBM KLCI (+0.6%) halted a six-day losing streak yesterday, stemming from the positive developments over the ongoing trade talks between the U.S. and China. The lower liners – the FBM Small Cap (-0.04%), FBM Fledgling (-0.2%) and FBM ACE (-0.3%), however, all trended lower after erasing their intraday gains, while the broader market finished mixed.
  • Market breadth turned positive as advancers pipped decliners on a ratio of 394-to-371 stocks. Traded volumes added 44.2% to 2.07 bln shares, lifted by the positive market sentiment.
  • Chart-toppers on the FBM KLCI were banking heavyweights like Public Bank (+40.0 sen), CIMB (+24.0 sen) and Hong Leong Bank (+12.0 sen), while Malaysia Airport Holdings and Petronas Gas added 16.0 sen and 12.0 sen respectively. Consumer products stocks like BAT(+RM1.08), Dutch Lady (+68.0 sen), Heineken (+52.0 sen) and Ajinomoto (+30.0 sen) rose, while LB Aluminium gained 1.0 sen after reporting a strong set of quarterly earnings.
  • In contrast, notable decliners on the broader market were Hong Leong Industries (-28.0 sen), Panasonic (-28.0 sen), KESM Industries (-19.0 sen), MyEG (-17.0 sen) and Petron Malaysia (-17.0 sen). Meanwhile, Nestle (-50.0 sen), Hong Leong Financial Group (-8.0 sen), Maxis (- 8.0 sen), KLCC (-7.0 sen) and Maybank (- 5.0 sen) led the key index’s decliners list.
  • Asia benchmark indices staged a sharp recovery, boosted by the positive trade developments where China has agreed to lower its tariff on imported U.S. cars to 15% (from 40%). The Nikkei jumped2.2%, while the Hang Seng Index (+1.6%) reclaimed the 26,000 psychological level.The Shanghai Composite added 0.3%, while ASEAN stockmarkets finished in the positive territory on Wednesday.
  • Wall Street advanced overnight as the as the Dow (+0.6%) recovered all its previous session losses after trade tensions eased and following the bailing of a Huawei executive that was arrested in Canada. On the broader market, the S&P 500 added 0.5%, while the Nasdaq climbed 1.0% higher.
  • Earlier, European equities – the FTSE (+1.1%), CAC (+2.2%) and DAX (+1.4%), all extended their gains amid a more upbeat sentiment following a potential U.S.-China trade deal. Meanwhile, British Prime Minister May remained in power in after surviving a no confidence vote.

THE DAY AHEAD

  • As the U.S-China trade dispute seems to be thawing, the Malaysian stockmarket saw a decent recovery yesterday to break its downward spell. However, the recovery appears selective, concentrated on index heavyweights while the broader market only saw superficial gains.
  • While we think the near term positivity should sustain amid an improved sentiment, the gains may still be measured as we see selective follow through buying as the lack of broadbased buying support is likely to limit the upside, in our view. Therefore, we think that the 1,670 level may become a significant near term hurdle for the FBM KLCI, which is followed by the 1,680 level. The supports are at 1,657 and 1,650 respectively.
  • The lower liners and broader market performances were relatively mixed despite the gains on the key index constituents yesterday. As it is, marketinterest on these stocks remains low and although they are also due for a rebound from oversold, the indifferent trend looks to continue for now.

COMPANY BRIEF

  • BIMB Holdings Bhd has made a partial redemption of RM609.9 mln of a 10-year RM1.66 bln sukuk, which was issued at a discount and fully subscribed by Lembaga Tabung Haji. The maturity date of the sukuk is 12th Decembe 2023.
  • The exercise is expected to reduce the group’s future payment obligations under the sukuk issue and is expected to have a positive impact on its future earnings. (The Edge Daily)
  • Cypark Resources Bhd has secured two contracts totaling RM450.0 mln to build two solar photovoltaic energy generating facilities, one of which is in Sik, Kedah and another one at Empangan Terip, Negeri Sembilan. (The Edge Daily)
  • Alam Maritim Resources Bhd has been awarded another contract to provide panMalaysia underwater services for petroleum arrangement contractors. This is its third PAC contract win since 30th November this year. The project by Hess Exploration and Production Malaysia BV is on a regular or a call-out basis, whereby work orders will be issued by client based on the schedule of rates as set forth in the contract. (The Edge Daily)
  • Zhulian Corp Bhd’s founder, Teoh Beng Seng has resigned from his position as President-cum-Chief Executive Officer (CEO) after more than 12 years at the helm of the multi-level marketing company due to personal reasons. Teoh was appointed to the board in April 2006. (The Edge Daily)
  • My E.G. Services Bhd (MyEG) said that it is unaware of any factors which may have resulted in the sharp fall in its share price to a five-month low yesterday. The group has made due inquiry with its Board of Directors (BoD) and major shareholders to seek the cause of the unusual market activity, but could not find any reason behind the share price movement. (The Star Online)
  • Bermaz Auto Bhd (BAuto) posted more than three-fold jump in 2QFY19 net profit to RM73.9 mln, from RM22.2 mln, owing to better sales during the tax holiday period, improved vehicle sales mix and margins.
  • Other contributing factors included the stronger Ringgit against the Japanese Yen and significantly higher share of profit contribution from its associate company, Mazda Malaysia Sdn Bhd, due to the higher production volume for the new CX-5 model. Revenue, meanwhile, rose 46.3% Y.o.Y to RM690.3 mln, compared to RM471.7 mln previously. (The Star Online)
  • Poh Huat Resources Holdings Bhd‘s 4QFY18 net profit grew 16.9% Y.o.Y to RM20.9 mln vs. RM17.8 mln a year ago, on higher sales from both its Malaysian and Vietnamese operations. Quarterly revenue also gained 10.4% Y.o.Y to RM189.5 mln, from RM171.7 mln last year and Poh Huat has proposed a final dividend of 2.0 sen per share. (The Star Online)
  • Pasdec Holdings Bhd is disposing its entire stake in a South African associate company at a loss in a bid to settle a debt it owes a business partner, extricate itself from a corporate guarantee and to streamline its operations and realign focus on its Malaysian property business.
  • The group will sell CRH Africa Automotive Proprietary Ltd for 60.0 mln SouthAfrican Rand (or approximately RM18.0 mln) to South Africa-based P Pather Capital Proprietary Ltd (PPC), which would result in a loss of RM440,000.
  • The stake in CRH is held under Pasdec Automotive Technologies (Proprietary) Ltd (PAT), which has a 30.9% equity stake in CRH. PAT is in turn 70.0%-owned by Pasdec's 97.0%-owned Pasdec Resources SA Ltd, with the remainder 30.0% held by PPC. Thus, Pasdec has an effective shareholding of 21.0% in CRH. (The Edge Daily)


 

Source: Mplus Research - 13 Dec 2018

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M+ Online Technical Focus - 12 Dec 2018

Author: MalaccaSecurities   |  Publish date: Wed, 12 Dec 2018, 11:46 AM


The FBM KLCI gapped down to record its sixth straight session of decline as the key index closed at around the 1,652.63 pts yesterday. The MACD Histogram has extended another red bar, while the RSI remains below 50. The resistance will be pegged around the 1,670-1,700 levels. Support will be set around the 1,630 level.

BAUTO has formed a bullish engulfing candle to rebound from the EMA9 level. The MACD Histogram has extended another green bar, while the RSI has risen above 50. Monitor for a breakout above RM2.16, targeting the RM2.25 and RM2.31 levels. Support will be set around the RM2.05 level.

IGBREIT has advanced to close above the EMA9 level with improved volumes. The MACD Histogram has turned green, while the RSI has risen above 50. Monitor for a breakout above RM1.72, targeting the RM1.80-RM1.85 levels. Support will be anchored around the RM1.68 level.

MBSB has advanced to re-test the EMA60 level with rising volumes. The MACD Histogram has extended another green bar, while the RSI is approaching 50. Monitor for a breakout above the RM1.00 level, targeting the RM1.05-RM1.11 levels. Support will be pegged around the RM0.95 level.

Source: Mplus Research - 12 Dec 2018

Labels: BAUTO, IGBREIT, MBSB
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Mplus Market Pulse - 12 Dec 2018

Author: MalaccaSecurities   |  Publish date: Wed, 12 Dec 2018, 10:04 AM


  • The FBM KLCI (-0.6%) remained in the red for the sixth straight session, dragged down by the sluggish economic data from China and Japan that fueled expectation of a global economic slowdown. The lower liners also ended mostly lower as the FBM Small Cap and FBM ACE sank 1.0% and 1.1% respectively, while the Healthcare sector (+0.5%) outperformed the negative broader market.
  • Market breadth remained negative as decliners outnumbered advancers on a ratio of 549-to-253 stocks. Traded volumes decreased 46.1% with only 1.43 bln shares exchanging hands as investors adopted a risk-off mode.
  • Two-thirds of the FBM KLCI’s constituents fell, dragged down by Petronas Dagangan (-34.0 sen), followed by Hong Leong Bank (-20.0 sen), Public Bank (-20.0 sen), Press Metal (-16.0 sen)and CIMB (-14.0 sen). Among the biggest decliners on the local bourse were BAT (- 70.0 sen), Dutch Lady (-50.0 sen), Bintulu Port (-45.0 sen), Heineken (-38.0 sen) and BLD Plantations (-27.0 sen).
  • On the flipside, notable advancers on the broader market were Carlsberg (+30.0 sen), UMW Holdings (+24.0 sen), Ata IMS (+11.0 sen), Berjaya Media (+10.5 sen) and Wang-Zheng (+8.0 sen). Key winners on the local bourse were Nestle (+RM1.10), Hong Leong Financial Group (+28.0 sen), Hartalega (+13.0 sen), IHH (+9.0 sen) and KLK (+6.0 sen).
  • Asia benchmark indices closed on a mixed note as the Nikkei slipped 0.3% on weakness in shares of automakers. Both the Hang Seng Index and the Shanghai Composite added 0.1% and 0.4% respectively after recovering all their intraday losses after China re-affirmed itsstance on the on-going trade talks with U.S. ASEAN stockmarkets, meanwhile, closed mixed yesterday.
  • U.S. stockmarkets ended mostly lower overnight as the Dow fell 0.2% after U.S. President Donald Trump threatened a government shutdown should funding were not approved for the proposed border wall. On the broader market, the S&P 500 declined 0.04% after erasing all its intraday gains, but the Nasdaq extended its gains by 0.2%.
  • Earlier, European equities – the FSTE (+1.3%), CAC (+1.4%) and DAX (+1.5%), all rebounded after the Chinese government is said to be reviewing a proposal to cut tariffs on U.S. made autos to 15% from 40%. Market sentiment was also boosted by France’s President Emmanuel Macron plans to cut taxes and lift wages for workers.

THE DAY AHEAD

  • Once again, the Malaysian stockmarket has fallen more than anticipated as the selling remains unabated amid persistent talk of a weaker global economic outlook for 2019. The frail market condition is also leaving most market players on the sidelines for longer.
  • Under the prevailing environment, the downside bias is still present that could further leave the key index at a fresh year low after it recorded a new low for the year at 1.652 points yesterday. However, the key index is also oversold and a rebound is already due, albeit there are still few signs of a rebound as yet.
  • With no signs of a reversal as yet, we see further near term weakness as sentiments remain subdued and the buying interest is still faint. With the key index already tethering near the 1,650support, a breach could send the FBM KLCI to the 1,646 and 1,640 levels. The resistances remain at the 1,660 and 1,670 levels.
  • The FBM Small Cap, Fledgling and ACE Market indices are seeing little reprieve and are continuing to mark new lows for the year. Their immediate outlook remains frail amid the lack of buying support, albeit they are oversold and a rebound is already overdue.

COMPANY BRIEF

  • LB Aluminium Bhd‘s 2QFY19 net profit jumped 69.4% Y.o.Y to RM2.8 mln, from RM1.7 mln a year earlier, mainly due to higher sales volume and ASPs. Revenue also gained 12.9% Y.o.Y to RM143.3 mln vs. RM126.9 mln previously. (The Edge Daily)
  • Alam Maritim Resources Bhd has clinched a conditional five-year contract from ExxonMobil Exploration and Production Malaysia Inc to provide panMalaysia underwater services for petroleum arrangement contractors.
  • The contract is on a call-out basis, whereby work orders will be issued by clients based on schedule of rates provided. Thus, the total value of the contract will be contingent upon the actual work orders and the scope of work performed. (The Edge Daily)
  • Vortex Consolidated Bhd is acquiring a mixed development project in Kajang with a gross development value (GDV) of more than RM340.0 mln, in-tandem with its business diversification into the property sector.
  • The group is planning to buy over a 85.0% equity stake in loss-making private property firm, Paris Dynasty Land SdnBhd, for a nominal cash consideration of RM100. Paris Dynasty Land owns a 2.8 ac. iece of freehold land, including an existing property development on the land named “the Louvre”. Construction on the Louvre commenced in March 2015 and is currently only 20.2% completed. (The Edge Daily)
  • AirAsia Group Bhd and its subsidiary AirAsia X Bhd have been sued by Malaysia Airports Holdings Bhd (MAHB) for a total of RM36.1 mln for outstanding airport taxes.
  • MAHB had sent legal letters to AirAsia and AAX demanding both airlines remit outstanding airport taxes or passenger service charges (PSCs) for international departures from 1st July 2018.
  • Both AirAsia and AAX said they would defend these proceedings “vigorously” as they believe the claims were made “without justification and are unreasonable”. (The Edge Daily)

Source: Mplus Research - 12 Dec 2018

Labels: LBALUM, ALAM, AIRASIA, AAX
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Mplus Market Pulse - 11 Dec 2018

Author: MalaccaSecurities   |  Publish date: Tue, 11 Dec 2018, 09:13 AM


Selling Pressure May Ease

  • Tracking the sharp decline on Wall Street, the FBM KLCI (-1.0%) registered its fifth straight session of decline after hovering in the negative territory for the entire trading session. The lower liners – the FBM Small Cap (-1.5%), FBM Fledgling (- 1.4%) and FBM Ace (-1.9%) all took a beating, while the broader market was painted in red.
  • Market breadth stayed negative as decliners thumped advancers on a ratio of 612-to-194 stocks. Traded volumes, however, rose 38.7% to 2.65 bln shares as the selling activities intensified.
  • Leading the FBM KLCI decliners list were Hong Leong Financial Group (-50.0 sen), followed by Hong Leong Bank (-30.0 sen), KLK (-24.0 sen), Genting (-21.0 sen) and Sime Darby Plantation (-21.0 sen). Consumer products stocks like Fraser & Neave (-66.0 sen), BAT (-58.0 sen),Ajinomoto (-54.0 sen) and Carlsberg (- 34.0 sen) were among the biggest losers on the broader market. Top Glove sank 35.0 sen after being accused of abusing migrant workers’ rights.
  • Among the biggest advancers on the broader market include Heineken (+30.0 sen), LPI Capital (+10.0 sen), Pintaras (+10.0 sen) and Enra Group (+9.0 sen). Padini added 9.0 sen, snapping a six-day losing streak. There were only three gainers on the local bourse – Petronas Dagangan (+50.0 sen), Nestle (+40.0 sen) and IHH (+4.0 sen).
  • Asia benchmark indices trended sharply lower, dragged down by concerns over global economic growth amid the weakerthan-expected U.S. jobs data. The Nikkei slipped 2.1%, while the Hang Seng Index (-1.2%) retreated for the fourth straight session. The Shanghai Composite (-0.8%)ended below the 2,600 psychological level. ASEAN equities, meanwhile, was splashed in red on Monday.
  • U.S. stockmarkets recovered all their intraday losses as the Dow rose 0.1% after investors shifted their focus on the upcoming U.S. Federal Reserve meeting that is widely anticipated to raise interest rates. On the broader market, the S&P 500 gained 0.2%, anchored by the technology sector (+1.4%), while the Nasdaq added 0.7%.
  • Earlier, European equities – the FSTE (- 0.8%), CAC (-1.5%) and DAX (-1.5%), all took a beating after British Prime Minister Theresa May confirmed a decision to postpone a vote on her plan for Brexit. Market weakness was further compounded by Bank of France’s remark of the country’s potential weaker-thanexpected GDP data.

THE DAY AHEAD

  • Although we expected stocks on Bursa Malaysia to retreat yesterday, the falls were steeper-than-expected amid an intensifying selling spree that also sent the key index to its lowest level in five months.
  • As it is, market sentiments remain weak due to the escalating trade and political tensions between the U.S. and China that threatens to boil over with the sides each ramping up rhetoric. However, with the key index approaching its year low and with the market tipping into the oversold territory, we think a rebound is already due.
  • The slight positivity in the U.S. markets overnight could provide some reprieve for Malaysia stocks, albeit we think that any rebound is likely to be contained due to the prevailing cautious market undertone.Hence, we think the 1,670 level could be a stiff near term hurdle that is followed by the 1,680 level. The supports are at 1,666 and its July low of 1,657.
  • However, the broader market remains in a state of flux as indices like the FBM Small Cap continues to post fresh year lows and the near term outlook remains frail as market players are still staying on the sidelines. Although the lower liners are already due for a rebound from oversold, the weak market conditions are likely to keep a lid on their performance over the near term.

COMPANY BRIEF

  • Top Glove Corp Bhd‘s Chairman, Tan Sri Dr Lim Wee Chai said that Top glove’s operations are running as usual and its supply with the UK’s National Health Service (NHS) were not affected, despite allegations of forced labour made in the UK’s The Guardian newspaper yesterday.
  • Lim called the news report inaccurate and clarified that contributions from supply to the UK’s NHS are minimal to Top Glove. (The Edge Daily)
  • Prestariang Bhd has announced that it has not received any notice of default from the Government relating to the cancellation of the Immigration Department's RM3.5 bln National Immigration Control System (SKIN) concession.
  • To recap, the group was appointed by the Government in 2017 to implement the replacement for the Malaysian Immigration System (myIMMs) by 2020. However, Home Minister Tan Sri Muhyiddin Yassin was reported to have said that the Government would cancel the SKIN concession to make way for the development of a new system that iscomprehensive, effective and user friendly. (The Star Online)
  • Tenaga Nasional Bhd (TNB) is planning to subscribe to a Compulsorily Convertible Debenture (CCD) for 2.26 bln rupees (RM133.2 mln) to facilitate its direct investment in the construction of a hydroelectric power plant in India.
  • The CCD is issued by GMR Bajoli Holi Hydropower Pvt Ltd (GBHH), which is constructing the 180MW run-of-river plant within the Himalaya Range in the State of Himachal Pradesh, slated to commence commercial operations by October. The proposed investment is inline with its strategy to grow its portfolio of energy assets in India. (The Edge Daily)
  • Scientex Bhd is issuing 25.3 mln new shares to satisfy the proposed acquisition of a 42.4% equity stake in Daibochi Bhd. A conditional share sale agreement (CSSA) was inked yesterday with certain shareholders of Daibochi Bhd for the RM222.5 mln deal.
  • However, Scientex, which is keen to extend a mandatory general offer (MGO) for the remaining stake in Daibochi after the acquisition, has yet to decide whether to acquire the remaining stake by cash or a further issuance of new shares in Scientex. (The Star Online)
  • Kumpulan Perangsang Selangor Bhd (KPS) plans to raise up to RM500.0 mln via an Islamic Medium Term Notes Programme to fund general corporate purposes and refinance the group's existing borrowings. The sukuk programme has a tenure of up to 15 years. (The Star Online)
  • MAA Group Bhd is disposing all the 24.3 mln shares (or approximately 48.0% stake) it owns in Australian-based retail mortgage and loan securitisationcompany, Columbus Capital Pty Ltd (CCA) for A$21.0 mln (RM63.0 mln).
  • The shares are held under Columbus Capital Singapore Pte Ltd (CCS), which is a sub-subsidiary of MAA. CCS is held under MAA International Investments Ltd, which is wholly owned by MAA Corp Sdn Bhd, which is in turn wholly owned by MAA.
  • The group will be selling its stake to Consortia Group Holdings Pty Ltd, which is expected to be completed by 20th December 2018 and reap a gain of RM7.7 mln. (The Edge Daily)
  • Malaysia Airports Holdings Bhd (MAHB) recorded 4.3% Y.o.Y more passengers in November compared with the same period a year ago, with traffic boosted by growth from both international and domestic passenger movements.
  • A total of 8.3 mln passengers passed through the 39 airports it operates in Malaysia last month, compared with 7.9 mln in November 2017. The international sector also recorded growth of 4.0% to 4.3 mln passenger movements, while the domestic sector was up 4.6% to 4.0 mln passengers. (The Edge Daily)

Source: Mplus Research - 11 Dec 2018

Labels: TOPGLOV, PRESBHD
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