• The FBM KLCI eked out a 0.1% gain, boosted by last minute buying support in selected heavyweights amid the bullish sentiments spilled over from the U.S. stockmarkets overnight. The key-index however, declined 0.2% W.o.W, notching four straight weeks of losses. The majority of the lower liners, meanwhile, finished in the red, with the exception of the FBM Ace amid the generally soft broader market.

• Market breadth turned positive as advancers outperformed the decliners on a ratio of 460-to-362. Traded volumes jumped 36.6% to 2.4 bln shares, lifted by the buying-interest in ACE market counters on higher risk appetite after the U.S. Federal Reserve adopted a more dovish outlook in its monetary policies moving forward.

• Major outperformers on Friday include blue-chips like Genting (+31.0 sen), Petronas Gas (+22.0 sen), BAT (+14.0 sen), KLCC (+8.0 sen) and Hong Leong Financial Group (+6.0 sen). Meanwhile, Ajinomoto (+72.0 sen), Nestle (+30.0 sen), Aeon Credit Service (+28.0 sen), Chin Teck Plantations (+14.0 sen) and Lafarge Malaysia (+13.0 sen) topped the broader market advancer’s list.

• On the other hand, United Plantations (- 32.0 sen), KESM (-22.0 sen), Warisan (- 16.0 sen), Oriental Interest (-14.0 sen) and Malton (-13.0 sen) declined on Friday, while key-index players like Petronas Chemicals (-10.0 sen), Digi (-7.0 sen), Kuala Lumpur Kepong (-4.0 sen), Telekom Malaysia (-4.0 sen) and Axiata (-3.0 sen) underperformed its peers.

• Asian indices continued their uptrend momentum, ahead of the U.S. corporate quarterly earnings results. The Nikkei (+0.1%) inched higher, while the Shanghai Composite index gained 0.1%, lifted by upbeat Chinese trade data. The Hang Seng index also finished 0.2% higher, taking cue from the positive sentiments in the U.S. stockmarkets. The majority of ASEAN equities advanced on Friday.

• Wall Street hit fresh new highs as weaker than-expected economic data dimmed prospects of more interest rate hikes this year. The Dow ended up by 0.4% on the back of gains in technology giants like Microsoft (+1.4%) and Intel (+1.3%). On the broader market the S&P 500 gained 0.5%, with nine-of-ten sectors in the green, while the Nasdaq rallied 0.6% amid expectations of a stronger earnings season.

• European benchmark indices were splashed in red, weighed down by softer U.S. economic data, weakening Greenback and losses in banking giants. The FTSE shaved off 0.5%, on the back of losses in exporters amid a stronger Pound. Subsequently, the DAX (-0.1%) also ended the week on weak footing, while the CAC flatlined.

The Day Ahead

• Although market sentiments on Bursa Malaysia are still generally insipid with the lack of fresh positive catalysts, we think the key index could extend its cautious uptrend amid the continuing mild support on the index heavyweights. At the same time, market interest is also slowly returning after a lull period as mild bargain hunting activities on the lower liners are starting to creep up again.

• Collectively, the above trends could help to provide some near term stability and this will allow the key index to build up a firmer base. Hence, we see the key index trending higher to re-test the 1,760 level over the near term, before making another pass at the 1,765 level. The 1,750 level remains the key support for now.

• We also expect the interest on the lower liners to pick-up on renewed trading interest on the lower liners. However, the gains might be tempered by the quick profit taking activities.

Company Briefs

• Lien Hoe Corp Bhd is selling approximately 15 ha. (36.4 ac.) land in Johor Bahru for RM100.5 mln to generate cash, which will finance the company's capital requirements. The sale is to Plato Assets (M) Sdn Bhd. (The Edge Daily)

• Mlabs System Bhd, whose share price had more than tripled in the last 10 days from 12 sen on 3rd July 2017 to close at 37 sen last Friday, has been slapped with an Unusual Market Activity (UMA) query from Bursa Malaysia.

• The stock jumped more than five times than its yearly low of seven sen on 12th September 2016 and was the second most actively-traded stock on Bursa in morning trade last Friday. (The Edge Daily)

• Ajiya Bhd has entered into a Memorandum of Understanding (MOU) with Syarikat Perumahan Negara Bhd (SPNB) to implement Ajiya’s Green Integrated Building Solutions (AGIBS) in the development of housing projects under the SPNB Group.

• Ajiya would supply its AGIBS at an agreed cost which will be determined later and/or be appointed as design & build contractor for the housing projects/program implemented by the SPNB Group. (The Edge Daily)

• Amcorp Properties Bhd (AmProp) and its joint venture (JV) partner, Grosvenor ? Europe Investments Ltd, have acquired two new properties in the Chamberi district of Madrid, Spain.

• The JV will transform the buildings — located on Modesto Lafuente and Santa Engracia into high-end residential and commercial spaces. The property at Modesto Lafuente is a 10-storey office building which will be converted into 13 exclusive apartments, with an underground parking facility. (The Edge Daily)

• Public Bank Bhd will redeem its RM3.0 bln bonds due in 2022 on 3rd August 2017. The bonds have a coupon rate of 4.3% per annum and were issued on 3rd August 2011. (The Edge Daily)

• Affin Holdings Bhd has received approval from the Finance Ministry and Bank Negara Malaysia to proceed with its proposed reorganisation.

• The reorganisation entails the transfer of Affin Holdings’ entire shareholding in various units to Affin Bank Bhd. The units include Affin Hwang Investment Bank Bhd, Affin Moneybrokers Sdn Bhd, Axa Affin Life Insurance Bhd and Axa Affin General Insurance Bhd. (The Edge Daily)  

Source: Mplus Research - 17 Jul 2017