Tracking the weakness of the Ringgit against the Greenback, coupled with the fall in crude oil prices, the FBM KLCI (- 0.5%) extended its losses for the fourth straight session to close 2.0% W.o.W lower. The lower liners – the FBM Small Cap (+0.04%), FBM Fledgling (+0.5%) and FBM and FBM Ace (+0.6%), however, ended higher. Meanwhile, the Industrial Products (+0.01%), Construction (+0.1%) and Technology (+1.2%) sectors outperformed the mostly negative broader market.

Market breadth turned positive as gainers pipped losers on a ratio of 397-to-369 stocks. Traded volumes, however, declined 5.4% to 1.33 bln shares on a holiday shortened trading week.

BAT (-48.0 sen) topped the FBM KLCI decliners list, followed by Maxis (-13.0 sen), Hap Seng (-10.0 sen), PPB Group (- 8.0 sen) and IOI Corporation (-8.0 sen). Consumer bellwethers like Dutch Lady (- RM1.30), Ajinomoto (-50.0 sen), Panasonic Malaysia (-20.0 sen) and Nestle (-12.0 sen) were amongst the biggest decliners on the broader market. EITA Resources slipped 3.0 sen despite bagging a RM15.2 mln to supply and install 18 units of lifts.

Leading the gainers on the broader market were Time dotCom (+84.0 sen), LPI Capital (+48.0 sen), Choo Bee Metals (+26.0 sen), Press Metal (+24.0 sen) and Pos Malaysia (+20.0 sen). Key winners on the big board were Hong Leong Financial Group (+42.0 sen), Public Bank (+4.0 sen), Axiata (+1.0 sen), Sime Darby (+1.0 sen) and YTL (+1.0 sen).

Japanese stockmarkets rebounded from three-weeks low as the Nikkei gained 0.7%, lifted by buying support in banking and Apple-related electronic part manufacturers shares. Both the Shanghai Composite and Hang Seng Index were closed for the closed for the Mid-Autumn Day festical. ASEAN stockmarkets, meanwhile, ended mostly higher.

Wall Street ended in the red last Friday as the Dow fell another 0.5% on weakerthan- expected University of Michigan consumer sentiment preliminary data for September which stood at 89.8. On the broader market, the S&P 500 slipped 0.4%, dragged down by the weakness in financial and energy sectors, while the Nasdaq closed 0.1% lower, but the latter managed to climb 2.3% W.o.W higher.

European benchmark indices - the FTSE (- 0.3%), CAC (-0.9%) and DAX (-1.5%), all finished in the negative territory as financial stocks - Royal Bank of Scotland (-4.4%), Barclays (-2.8%) and Commerzbank (-2.5%) all took a beating. This came after Deutsche Bank AG (- 9.0%) said it has no intentions to steel the civil claims of a US$14.0 bln fine from the U.S. Department of Justice related to the mortgage-backed securities it packaged between 2005 to 2007.

THE DAY AHEAD

The weakness in the global stockmarkets, couple with the sustained domestic market cautiousness, is likely to see stocks on Bursa Malaysia heading south again over the near term. There remain few domestic catalysts to entice investors into the market as they await for further developments on the potential interest rate hike in the U.S. Although a rate hike appears unlikely in the upcoming FOMC meeting later in the week, the Federal Reserve is still maintaining its stance to raise rates twice in 2016, thereby pointing another rate hike either in November of December this year.

Meanwhile, the sustained weakness on Bursa Malaysia could see the FBM KLCI retesting the 1,650 support level and if it gives way, the next support is pegged at the 1,630 level. On the upside, there key resistance is at the 1,680 level.

COMPANY BRIEF

Apex Healthcare Bhd is planning to construct a new oral solid dosage manufacturing facility (SPP NOVO) in Cheng Industrial Estate, Melaka for RM68.0 mln.

The new building will be a stand-alone facility adjacent to Apex's current manufacturing facilities and is expected to commence construction in 4Q2016 and to be commissioned in 1H2018.

SPP NOVO is part of Apex's strategic investment to design, build and operate an advanced manufacturing facility for the production and packaging of tablets and capsules. (The Star Online)

Chin Hin Group Bhd has inked a sale and purchase agreement with TKW Capital Sdn Bhd to acquire a 20.4 ha. freehold land in Kota Tinggi, Johor for RM22.0 mln to cater to the group's production expansion plans.

The newly acquired land will house a 45,000-tonne precast concrete and a 600,000-sq.m AAC block plant, which are targeted to commence operations in 4Q2017.

The proposed acquisition is expected to be completed by 4Q2016. (The Edge Daily)

Magni-Tech Industries Bhd registered a 51.1% Y.o.Y hike in its 1QFY17 net profit to RM23.5 mln, from RM15.6 mln a year ago – due to stronger revenue, which jumped 40.0% Y.o.Y to RM271.4 mln, from RM193.8 mln in 1QFY16 and higher other operating income.

The group has also declared a single tier interim dividend of five sen a share amounting to RM8.1 mln (payout ratio of 34.6%) with the entitlement date fixed on 13th October 2016. The dividend is payable on 28th October 2016. (Bernama)

Genting Plantations Bhd’s 73.7% indirectly owned subsidiary, Palmindo Holdings Pte Ltd has completed the acquisition of Cahaya Agro Abadi Pte Ltd (CAA) and Palm Capital Investment Pte Ltd (PCI) in West Kalimantan for a cumulative amount of US$48.0 mln (RM198.7 mln).

The purchase consideration shall be paid via a cash consideration of US$26.2 mln and assumption by Palmindo of CAA and PCI’s outstanding liabilities of US$21.9 mln.

The acquisition will increase Genting Plantations' landbank by 26,248 ha. to 264,624 ha. (The Edge Online)

Bintai Kinden Corp Bhd's subsidiary, Bintai Kindenko (Vietnam) Co Ltd was awarded a letter of intent from Riverview Company Ltd to undertake a RM32.6 mln subcontract.

The project involves mechanical, electrical, plumbing and fire-fighting works in Vietnam for a residential project called Project Shining and is expected to be completed in October 2017. (Bernama)

Aeon Co (M) Bhd expects the second half of this year and 2017 to remain challenging due to weak consumer sentiment, albeit the slight recovery recently. However, it is confident of charting business growth for the group and has no plans to reduce its employment size or close any of its malls.

Further, Aeon will be opening another shopping mall in Johor Baru, as well as its first Aeon Mall in East Malaysia in 2017. (The Edge Online)

Source: M+ Online Research - 19 Sep 2016