• The FBM KLCI mirrored the positive movements in regional and U.S. stockmarkets overnight, closing 0.6% higher – led by gains in banking heavyweights. Meanwhile, the lower liners continued to see buying support amid a mostly positive broader market.
• Market breadth was favourable as advancers beat decliners on a ratio of 594-to-411. Traded volumes also jumped 25.2% to 3.88 bln shares, owing to continued buying-support from foreign investors amid a strengthening Ringgit, coupled with the recovery in the global stockmarket sentiment.

• Petronas-linked companies - Petronas Gas (+32.0 sen) and Petronas Dagangan (+20.0 sen) pushed the key-index higher, followed by BAT (+68.0 sen), Public Bank (+28.0 sen) and Genting (+16.0 sen). Meanwhile, broader market movers were MPI (+42.0 sen), Malaysia Airports (+38.0 sen), Petron Malaysia (+35.0 sen) and Aeon Credit Service (+30.0 sen). Elsewhere, Poly Glass Fiber(+30.0 sen) hit record high after announcing stellar quarterly results.

• On the flip side, FGV (-18.0 sen), Kawan Food (-14.0 sen), TAHPS (-11.0 sen), Perusahaan Sadur Timah Malaysia (-10.0 sen) and JHM Consolidated (-9.0 sen) bucked the general positive trend on the local bourse. Main Board decliners, meanwhile, included Digi (-11.0 sen), Westports (-5.0 sen), Hap Seng (-2.0 sen), Petronas Chemicals (-2.0 sen) and Tenaga Nasional (-2.0 sen).

• Key benchmark bourses finished mostly in green, as investors returned from Monday’s public holiday. The Nikkei notched 0.7% in gains in a rangebound session, ahead of the Golden Week holiday celebrations. Meanwhile, the Hang Seng also closed 0.3% higher, although the Shanghai Composite retreated amid mild profit-taking. The majority of the ASEAN indices closed on an upbeat tone yesterday.

• U.S. stockmarkets inched higher on Tuesday, ahead of the highly anticipated quarterly results of giant phone-maker Apple. The Dow eked-out a 0.2% gain after a choppy trade – led by gains in Intel (+1.8%) and Visa (+1.4%). The S&P 500 (+0.1%), meanwhile, closed near record highs on the back of better-thanexpected earnings corporate earnings and the Nasdaq ended in green with minute gains.

• European equities ended higher overnight, spurred the positive buying momentum as investors digested the upbeat corporate earnings. The FTSE rose 0.6%, although gains were capped by the weakness in mining stocks, in-tandem with disappointing manufacturing data from China. Meanwhile, the DAX and the CAC rallied 0.6% and 0.7% respectively.

The Day Ahead

• Bursa Malaysia stocks continued to make headway amid the still positive market environment yesterday and the near term outlook is likely to stay the same, thus we expect the FBM KLCI to maintain its uptrend over the near term. Sentiments on the local bourse remains elevated riding on the ongoing positivity in the regional and global stockmarkets.

• At the same time, foreign participation is still on the ascend, thereby creating a latent demand for index-linked stocks and this will also help stocks on Bursa Malaysia to climb higher as it nears its next resistance of 1,780 level. Beyond the level, the FBM KLCI could close in on its next psychological resistance of 1,800, which could prove to be a more formidable level to clear after the recent strong gains.

• Apart from the index heavyweights, there continues to be strong retail interest on the broader market and this trend is set to continue over the near term amid the sustained market positivity. As we have noted earlier, traded volumes are still elevated, which is a clear sign that there is strong market interest that is a crucial ingredient for the market’s continuing ascend.

Company Briefs

• Practice Note 17 (PN17) company, EKA Noodles Bhd has announced the resignation of its Independent NonExecutive Chairman, Datuk Sohaimi Shahadan and Executive Director, Datuk Seri Chin Seak Huat, due to personal work commitments. Previously the largest shareholder of EKA, Datuk Chin has disposed off his shareholdings in the company in March 2017. Further, the group has appointed four new directors, namely Datuk Dr Chin Yew Sin, Leong Woay Hong @ Neoh Woay Hong, Lim Choo Hooi and Fong Yit Meng.

• Wintoni Group Bhd‘s shares trading activities could be suspended on the 9th May, 2017 if it fails to issue its 2016 annual report within five market days from 30th April 2017 or face suspension, as well any enforcement actions carried out by Bursa Securities.

• Malakoff Corp Bhd has secured a term loan facility of US$80.0 mln (about RM325.0 mln) to repay all outstanding amounts under an existing term loan facility obtained to finance the acquisition of a 40.0% equity stake in Hidd Power Co. BSC in 2012.

• The new three-year loan facility was procured from Mizuho Bank Ltd via Malakoff’s 100.0%-owned subsidiary, Malakoff International Ltd (MIL) and will be secured by a corporate guarantee of US$80.0 mln in favour of Mizuho by Malakoff, as well as a charge over all the shares of a wholly-owned MIL subsidiary, in addition to an assignment of debt service account maintained by MIL, with Mizuho as the security trustee.

• Seacera Group Bhd plans to issue a bonus issue of warrants, on the basis of two warrants-for-every five Seacera shares held on an entitlement date to be fixed later. The proposed exercise, which could involve as much as 174.3 mln warrants, is expected to be completed by the 3Q2017.

• Assuming all the Warrants C are exercised, the company could reap as much as RM237.0 mln, based on an assumed exercise price of RM1.36 per warrant.

• The new warrants will be the third warrant issued by the company, where Warrants A will be expiring on 16th May this year, while Warrants B is expiring on 29th May 2019.

• Manufacturer of inspection machines, ViTrox Corp Bhd has proposed a bonus issue of up to 236.3 mln new shares on the basis of one bonus share-for-every one existing ViTrox share.

• Following the bonus issue, ViTrox's enlarged share capital could reach RM52.4 mln (from RM23.8 mln) comprising 472.6 mln shares (from 234.9 mln shares), assuming all outstanding employees' share option schemes are fully exercised. The bonus issue is expected to be completed by 3Q2017.

• Anzo Holdings Bhd has been appointed the main contractor for Phase 2 of the Porto De Melaka Hotel and Resort development in Malacca. The 36-month contract was awarded by Tinta Anggun Engineering Sdn Bhd for RM109.3 mln.

• The contract includes main building works, architecture and mechanical and electrical works for the basement, associated infrastructure works, interior fit-out and furnishing and installation of equipment.The group noted that the financial commitment required is estimated to be approximately RM12.0 mln, which will be financed via the excess funds from the ongoing rights issue exercise, bank borrowings, internal funding or a combination of those.

• Ikhmas Jaya Group Bhd has been awarded a contract worth RM62.4 mln from Pelaburan Hartanah Bhd to carry out site clearance, earthworks, bore piling and pile cap works for a mixed development in Kuala Terengganu. The project will begin on 9th May this year and end on 8th May, 2018.

• The mixed development encompassed six floors of a shopping complex, one floor of basement and 10 floors of parking lots at Lot PT 4286, Bandar, Daerah Kuala Terengganu, Terengganu.

• Trive Property Group Bhd is partnering Universiti Teknologi Malaysia (UTM) to develop a solar farm with a gross development value of RM150.0 mln, through a collaboration agreement between the university and VSolar Group Bhd.

• Under the project, Trive will support VSolar by supplying solar components such as solar panels, solar inverters, battery chargers, batteries, solar pumps, mounting frames, trackers and accessories.

• Separately, Trive is working together with China's Hubei Guang Bo New Energy Co Ltd (HGB) to conduct R&D and produce power generation systems such as off-gird/grid-connected wind power generation system, solar power generation system and wind-solar complementary power generation system.

• Under the Memorandum of Understanding (MoU) signed by both parties, HGB will supply the technical know-how for the production of the various systems. Trive, on the other hand, will provide a 2.5-ac. factory site in Kulim, Kedah, to serve as a base station to conduct normal course of business.  

Source: Mplus Research - 3 May 2017