• Stocks on Bursa Malaysia extended their uptrend yesterday on the back of the improved market sentiments that aided a broad-based recovery where most subindices closed in the positive territory. The leading outperformer was the FBM ACE index that rose 1.1% as mild bargain hunting activities returned.
• Market breadth remained positive with advancers outpacing decliners on a 5-to- 3 ratio. Nevertheless, traded volumes continue to lose ground, falling another 3.5% to 2.79 bln shares as fresh leads were still lacking.
• On the key index, the main gainers were Genting (+23.0 sen) and Genting Malaysia (+6.0 sen), followed by celcos like Digi (+4.0 sen) and Maxis (+3.0 sen). Banking stocks like CIMB (+3.0 sen) and Maybank (+2.0 sen) also contributed to the FBM KLCI’s gains. In the broader market, the main movers were MPI (+94.0 sen), Panasonic (+60.0 sen), Nestle (+0.54 sen) and BAT (+42.0 sen). WCT gained 5.0 sen after it announced a share dividend plan, while Anzo rose 6.0 sen despite a query from the stock exchange on its share price jump.

• On the loser’s page, Shangri La Hotels lost 16.0 sen to top the list, followed by Mesiniaga (-8.0 sen), UEM Edgenta (-8.0 sen) and NSOP (-7.0 sen). YTL Corp was the sole decliner on the FBM KLCI, losing 1.0 sen for the day.

• Regional stock indices remained mixed with the Nikkei finishing 0.4% higher on the Yen’s weakness, but China stocks continue to dip, slipping below the psychological 3,200 points level amid fears that its stronger economy may prompt the PBOC to tighten credit conditions. The Hang Seng, meanwhile, fell as geopolitical issues still weigh on market sentiments. ASEAN stock indices were also mixed at the close.

• The Dow (-0.5%) retreated overnight, extending its fall for a fourth straight session after Goldman Sachs and Johnson & Johnson earnings missed forecast. At the same time, the healthcare sector was also pulled down along with the weakness in the bellwethers. The S&P 500 slipped 0.3%, while the Nasdaq was 0.1% lower.

• U.K. stocks slumped after Prime Minister May called for an early election and as the British Pound jumped, affecting many export oriented companies. Other key European stock indices like the CAC (- 1.6%) and the DAX (-0.9%) were also affected by the weaker market sentiments.

The Day Ahead

• After two days of rebound that lifted the key index back to the 1,740 level, sentiments could turn weaker over the near term after many global indices fell overnight. This could also lead to local stocks retreating once again as positive leads are still on the low side and many investors are turning increasingly wary of the near term market direction.

• Still, we think that the retreat is likely to be mild as there is no significant selling pressure as yet. This also means that the recent low of 1,730 will continue to serve as the major near term support.

• The lower liners and broader market shares could also see waning interest as more retail players retreat to the sidelines due to the lack of fresh leads.

Company Briefs

• S P Setia Bhd has outbid 24 others to secure the tender for the popular Toh Tuck Road site in Singapore today for S$265.0 mln (about RM847.6 mln) or S$939 per sq ft.

• The 4.6-acre leasehold plot will encompass the group's third development in Singapore, which will be a five-storey luxurious condominium project with an estimated gross development value of S$457.0 mln.

• Singapore’s Urban Redevelopment Authority issued the tender acceptance letter to the group’s wholly-owned subsidiary, S P Setia International (S) Pte Ltd today. The land comes with a 99-year lease tenure with a maximum permissible gross floor area (GFA) of 282,122 sq. ft. and a gross plot ratio of 1.4.

• The proposed condominium is expected to be completed within 60 months from its targeted launch in 2018. (The Star Online)

• Yong Tai Bhd is considering on disposing of its ailing textile and garmenting business in the near future. The disposal is in-line with its plans to diversify its core business to tourism and culturalrelated property development.

• However, Yong Tai noted it has not entered into any formal negotiation or agreement with any third party recently to dispose of the loss-making textile and garment business. (The Edge Daily)

• JKG Land Bhd has announced that its rights issue has been oversubscribed by 27.1% or 411.0 mln shares after it received valid acceptances and excess applications of 1.93 billion rights shares.

• The group had made available 1.52 bln rights shares for the exercise, on the basis of two rights shares-for-one existing share held (2-for-1).

• The proposed rights issue is priced at 10.0 sen apiece which would raise as much as RM151.7 mln.

• The proceeds will be used to finance its property development projects, expansion plans and working capital, as well as to repay its short-term bank borrowings.

• Vivocom International Holdings Bhd has clinched three contract wins with a combined value of RM44.7 mln for the installation of aluminium and glazing works.

• The first two contracts were awarded by PJD Construction Sdn Bhd, comprising a RM6.0 mln contract for design, fabrication, supply, delivery and installation of aluminium and glazing works for a hotel and another RM13.5 mln deal for two blocks of serviced apartments. Both projects are located in Pahang.

• Another contract for RM25.2 mln was given by Setiakon Builders Sdn Bhd for aluminium and glazing works for four 40- storey serviced apartment blocks in Damansara, Selangor.

• The group expects to complete the works for the hotel within 22 months from the date of commencement of the contract, while the two other jobs are expected to be completed within 24 months. (The Edge Daily)

• Petronas Chemicals Group Bhd (PetChem) has approved a final investment decision for an Isononanol plant within the Pengerang Integrated Complex in Pengerang, Johor, for a total investment cost of US$442.0 mln. The project is expected to come on-stream by 2H2019. (The Star Online)

• Landmarks Bhd has proposed a private placement to raise as much as RM36.9 mln, with an indicative issue price of 76.0 sen per placement share.

• The placement will involve issuing up to 48.6 mln new shares, representing up to 10.0% of the group's enlarged issued share capital, to third-party investors to be identified later.

• The exercise is expected to raise gross proceeds of RM36.5 mln under the minimum scenario and RM36.9 mln under the maximum scenario upon the completion of the proposed private placement.

• Out of the RM36.9 mln proceeds, RM13.0 mln will be used to pare down a term loan obtained from Malayan Banking Bhd, RM11.6 mln for capital expenditure as part of the development of the 338-hectare Treasure Bay Bintan waterfront resort city in Bintan, Indonesia, RM11.5 mln for working capital and the remaining RM870,000 to defray expenses in relation to the exercise. (The Edge Daily)

• Axiata Group Bhd is placing out 136.6 mln shares in edotco Group Sdn Bhd to Kumpulan Wang Persaraan (Diperbadankan) or KWAP for RM440.1 mln to further capitalise edotco. (The Edge Daily)

• Tomei Consolidated Bhd has clinched a one-year deal to distribute and retail China’s Xifu jewellery collections in Malaysia.

• The group has signed a distribution agreement with Shenzhen Harmony Batar Jewellery Co Ltd for the distributorship right. Xifu jewellery collections is owned and trademarked by the World Gold Council and includes a series of jewellery collections that focuses on the global wedding market. (The Edge Daily) Malaysian Pacific Industries Bhd’s (MPI) 3QFY17 net profit rose 11.0% to RM43.2 mln, from RM39.0 mln a year earlier – helped by forex gains and lower operating costs. Quarterly revenue also increased 12.0% Y.o.Y to RM396.0 mln, from RM352.1 mln last year. The group also proposed a second interim dividend of 19.0 sen per share, payable on 23th May 2017.

• Cumulative 9MFY17 net profit rose 16.0% Y.o.Y to RM137.9 mln, from RM118.8 mln a year ago, due to the aforementioned reasons, while revenue grew 3.3% Y.o.Y to RM1.16 bln, from RM1.12 bln. (The Edge Daily)  

Source: Mplus Research - 19 Apr 2017