The  FBM  KLCI  was  in  the  negative territory  for  almost  the  entire  trading session and  a last minute selldown from institutional investors saw the key index close  below  the  1,800  psychological level.  All  other  sub-indices  on  Bursa Malaysia  were also splashed in red  with the  Technology  sub  index  continuing  to lead the losers.

Market  participation  sank  21.7%  with only 1.74 bln shares exchanging  hands. Again,  market  breadth  was  broadly negative  with  losers  outnumbering gainers on a 5-to-1 ratio.

On the FBM KLCI, the leading the losers were  BAT  (-98.0  sen),  Petronas  Gas  (-62.0  sen),  PPG  Group  (-32.0  sen)  and Hong  Leong  Financial  Group  (-30.0 Sen).    KLK  fell  50.0  sen,  to  its  lowest level  since  May  2013.  On  the  broader market,  Aeon  Credit  plunged  72.0  sen while  Press  Metal  shed  33.0  sen. Elsewhere,  semiconductor  related companies like MPI  (-36.0 sen), Elsoft (-23.0 sen) and Inari (-20.0 sen) was hit  by slowdown  in  the  global  demand  for semiconductor products.

Banking  stocks  like  Public  Bank  (+20.0 sen),  Hong  Leong  Bank  (+6.0  sen)  and RHB Capital (+3.0 sen)  were among the top  gainers  on  the  key  index,  while  IHH and  Sime  Darby  added  3.0  sen  each. Meanwhile,  other  advancers  include Hong  Leong  Industries  (+30.0  sen), Super  (+18.0  sen)  and  Kossan  (+17.0 sen).  Ni Hsin  Resources gained  4.0 sen after appointments  of  a new Independent and Non-Executive Directors that spurred talks of a possible venture into the oil and gas industry.

The Nikkei was closed in conjunction with the Sports Day public holiday. The Hang Seng  Index,  meanwhile,  closed  0.2% higher,  erasing  its  morning  losses  after China  Mobile  signed  a  business  deal with  Deutsche  Telekom,  while  the Shanghai  index  fell  0.4%.  ASEAN indices,  however,  ended  mostly negative.

The  Dow  closed  lower  as  oil  prices slumped  to  a  four  year  low,  while  gold prices  continue  to  advance.  Investors were  also  cautious  of  the  earnings reporting  season,  which has started last week.  On  the  broader  market,  the  S&P 500  retreated  1.7%,  marking  its  worst three-day loss since 2011 as all ten main industry groups retreated more than 2%.

After  a  three-week  slide,  European stockmarkets  chalked-up  mild gains with the  FTSE (+0.41%), DAX (+0.27%) and CAC  (+0.12%)  closing  positively  as bargain  hunting  activities  emerge  after the  indices  hits  the  “oversold”  level  in three  years.  Airline  related  and  mining stocks  rebounded  with  Air  France-KLM (+1.6%) and Vienna Airport (+18.0%) on lower oil prices,  while Rio Tinto (+4.2%) and BHP Billiton (+2.9%) rose  on  betterthan-expected  China  trade  data  that eased  worries  on  the  slowdown  of demand for commodities.

THE DAY AHEAD

The  selling  spree  on  global  indices  has intensified and has also given Malaysian stocks  little  opportunity  to  stabilise  as market  sentiments  continue  to  turn lower. This has also left the FBM KLCI to continually break its support levels  –  the latest  being  the  psychological  1,800 points level.    With the downside risk still prevalent,  we  see  further  near  term consolidation on Bursa Malaysia with the next support pegged at the 1,780 level.

In  line  with  the  market’s  weakness, investor  participation  has  also  waned and we expect more investors to retreat to  the  sidelines  until  there  is  stability. With fewer investor participation, we also think  a  quick  recovery  will  also  be  hard to come by over  the near term amid the continuing market uncertainties.

COMPANY BRIEF

Goldis  Bhd  intends  to  raise  up  to RM460.0  mln  via  a  proposed renounceable  rights  issuance  of  460.0 mln  new  Redeemable  Convertible Cumulative  Preference  shares  to partially  refinance  its  borrowings  for  the acquisition  all  the  remaining  shares  in IGB  Corp  Bhd  at  RM2.88  per  share  in cash.

The total consideration for the proposed offer  would  be  satisfied  through internally  generated  funds  amounting  to about  RM59.0  mln,  while  the  remaining balance  entirely  by  borrowings.  (The Edge Daily)

Bertam Alliance Bhd has entered into a sale and purchase agreement with Nadi Hasil (M)  Sdn Bhd to acquire  33.01  ac. of  land  in  Tuaran,  Sabah  for  RM43.0 mln.

The  above  said  land  also  comprises  a brick  factory  and  a  block  of  doublestorey office building.

The  management  of  Bertam  plans  to either  develop  the  said  land  into  2,560-units  of  PR1MA  apartment  project  or  a 1,982-unit  of  5-storey  walk-up apartments project.

The  land  acquisition  is  expected  to  be completed  by  the  1Q2015  and  will  be funded  by  bank  borrowings  and internally  generated  funds.  (The  Edge Daily)

Halex  Holdings  Bhd’s  Managing Director,  Yeoh  Cheng  Poh,  has  ceased to  be  a  substantial  shareholder  in  the company  after  disposing  12.8  mln shares  in  the  agrochemicals  company for a total consideration of RM12.6 mln, or 98 sen per share.

The  disposal  took  place  on  10th October,  2014  and  he  is  now  left  with 2.0  mln  shares  -  1.89%  direct  interest and  0.56%  indirect  interest  in  Halex. (The Edge Daily)

The  Arbitral  Tribunal  has  dismissed  AV Asia  Sdn  Bhd  (AV  Asia)’s  lawsuit  claim for  RM300.0  mln  and  ruled  in  favor  of Astro  Malaysia  Holdings  Bhd  (Astro) over their long standing dispute.

In  2010,  AV  Asia  had  sued  MBNS  for breaching  a  Mutual  Non-Disclosure Agreement  dated  1st  August  2008, signed  between  the  two  parties,  in  the manufacture  and  supply  of  satellite dishes.

On 10th October 2014, the court ordered AV  Asia  to  pay  costs  in  the  sum  of approximately  RM3.42  mln  to  Astro. (The Edge Daily)

Malaysian  Resources  Corporation Bhd  (MRCB) has accepted the letter of acceptance from Johor Land Bhd for the construction of a 30-storey JLand Tower at  Komtar  JBCC  in  Johor  Bahru  at  a tender sum of RM197.36 mln.

The  job  has  a  tenure  period  of  24 months  and  should  be  completed  by November 2016. (The Edge Daily)

Dialog Group Bhd  has appointed Chan Yew  Kai  as  its  Executive  Deputy Chairman.  The  integrated  specialist technical services provider to the oil, gas and  petrochemical  industry  has  stated that  Chan  would  be  involved  with business  strategies  and  new  ventures. (The Star Online)

Source: Mplus Online Research - 14 Oct 2014