• The FBM KLCI (+0.1%) continues to track higher, albeit marginally – led by last minute buying interest in selected heavyweights. All the lower liners advanced, including the FBM Small Cap (+0.8%), the FBM Ace (+2.7%) and the FBM Fledgling (+0.5%) indices. The broader market also follow suit and closed in the green, with the exception of the Mining sub-sector.

• Market breadth was bullish as winners beat losers on a ratio of 529-to-295 stocks, stocks. Traded volumes, however, declined slightly by 4.3% to 1.72 bln shares ahead of the release of the U.S. Federal Reserve minutes.

• Significant key-index movers were BAT (+34.0 sen), Hong Leong Financial Group (+30.0 sen), Genting (+14.0 sen), Petronas Gas (+6.0 sen) and RHB Bank (+4.0 sen). Meanwhile, semiconductorrelated counters like Pentamaster (+30.0 sen) and KESM Industries (+20.0 sen) topped the gainers’ list, alongside Aeon Credit (+18.0 sen), Heineken Malaysia (+18.0 sen) and IQ Group (+18.0 sen).

• On the contrary, plantation stocks like United Plantations (-28.0 sen), Batu Kawan (-10.0 sen) and Genting Plantations (-10.0 sen) retreated, followed by Bursa Malaysia (-16.0 sen) and Panasonic Manufacturing (-10.0 sen). Meanwhile, PPB Group (-8.0 sen), Sime Darby (-8.0 sen), KLCC (-3.0 sen) and Astro (-2.0 sen) weighed on the blue chip gauge. Kuala Lumpur Kepong also lost 18.0 sen after reporting weaker-thanexpected 3QFY17 results.

• Key regional benchmark indices closed mostly lower, as investors digested a series of corporate quarterly earnings report, ahead of the latest Federal Reserve minutes. The Nikkei (-0.1%) slipped into the negative territory after a choppy session, alongside the Shanghai Composite index (-0.2%) that was weighed down by losses in materials-related stocks. On the flip side, the Hang Seng index climbed 0.9%, boosted by China Mengniu on expectations of positive 1H2018 quarterly results. ASEAN stockmarkets finished mixed on Wednesday.

• U.S. stocks notched minute gains as investors digested the minutes from the Federal Reserve’s meeting in July, despite renewed uncertainties in the White House’s ability to push forward with its tax reform agenda after President Donald Trump dissolved its manufacturing council. The Dow and the S&P 500 both eked out 0.1% gains, while the Nasdaq (+0.2%) closed slightly above the 6,345.0 psychological mark.

• Earlier, European stockmarkets ended higher, boosted by mining and resourcesrelated shares, as well as upbeat economic data. The FTSE gained 0.7%, lifted by upbeat labor data and gains in Glencore and Anglo American. Both the CAC and the DAX also rallied 0.7%, despite coming off intraday high.

The Day Ahead

• We continue to think that significant upsides are difficult to come by amid a still cautious market environment with few positive catalysts. At the same time, market conditions are also calmer as the North Korean missle crisis has abated temporarily.

• Therefore, we think there should be sustained near term upsides, but the gains are likely to remain mild as the buying interest is still tepid in view of the few leads available. The bargain hunting activities will be punctuated by quick bargain hunting activities that will also limit the gains.

• Hence, we see the key index’s upsides limited to around the 1,776-1,780 level, while in the broader market we see mild bargain hunting activities sustaining to give a lift to the lower liners.

Company Briefs

• MMC Corporation Bhd's subsidiary, Southern Water Technology Sdn Bhd has been served with a winding up petition over an arbitration award of RM10.9 mln by Suria 2000 Sdn Bhd. The petition was for the recognition and enforcement of a High Court order dated 8th May 2017 for the award dated 27th October 2016 which also included interest at the rate of 5.0% per annum until full realisation of the award.

• The winding up proceedings arose from the non-payment of the award by Southern Water Technology. Southern Water Technology disputes the award and its appeals against the enforcement of the award and in respect of its application to set aside the award are currently pending hearing at the Court of Appeal. (The Star Online)

• Seacera Group Bhd has received a letter of intent from Wearegold Sdn Bhd to award it a RM250.0 mln project to build 1Malaysia People’s Housing Programme (PR1MA) units in Rembau, Negri Sembilan. The project involves the building of 1,572 units of single- and double-storey terraced houses to be completed within 30 months. (The Star Online)

• Taliworks Corp Bhd’s 2Q2017 net profit sank 92.1% Y.o.Y to RM6.0 mln, primarily due to higher amortisation expenses, higher operating costs in both its water treatment plants, a realised loss on foreign exchange and a net provision for the discounting of receivables of RM10.9 mln, which was due to the delay in the implementation of the last stage of the Selangor water consolidation exercise. Revenue for the quarter, however, increased 18.8% Y.o.Y to RM91.3 mln.

• For 1H2017, cumulative net profit decreased 83.3% Y.o.Y to RM12.7 mln. Revenue for the period, however, added 7.0% Y.o.Y to RM162.6 mln. A second interim dividend of 2.0 sen per share, payable on 22nd September 2017 was declared. (The Star Online)

• Press Metal Aluminium Holdings Bhd’s 2Q2017 net profit grew 2.8% Y.o.Y to RM150.2 mln, owing to increased output and higher metal prices. Revenue for the quarter improved 31.1% Y.o.Y to RM2.08 bln.

• For 1H2017, cumulative rose 23.9% Y.o.Y to RM298.2 mln. Revenue for the period increased 42.6% Y.o.Y to RM4.10 bln. A second interim dividend of 1.5 sen per share was declared. (The Star Online)

• Dialog Group Bhd’s 4QFY17 net profit increased 32.9% Y.o.Y to RM103.6 mln, mainly due to higher contributions from the group’s joint ventures. Revenue for the quarter increased 35.1% Y.o.Y to RM969.0 mln.

• For FY17, cumulative net profit grew 25.7% Y.o.Y to RM370.6 mln. Revenue for the year expanded 34.0% Y.o.Y to RM3.39 bln. (The Edge Daily)

• Pharmaniaga Bhd’s 2Q2017 net profit fell 36.5% Y.o.Y to RM9.5 mln due to lower production by its manufacturing facilities arising from temporary closure of certain production lines for preparatory works to facilitate the commercialization of new products that were approved ahead of schedule. Revenue for the quarter slipped 2.6% Y.o.Y to RM518.0 mln.

• For 1H2017, cumulative net profit contracted 14.8% Y.o.Y to RM28.4 mln. Revenue for the period added 4.1% Y.o.Y to RM1.14 bln. A second interim dividend of 4.0 sen per share, payable on 15th September 2017 was declared. (The Edge Daily)

• Country Heights Holdings Bhd Executive Chairman and major shareholder, Tan Sri Lee Kim Yew has paid RM22.7 mln to settle the tax liabilities including penalties claimed by the Inland Revenue Board (IRB) against Country Heights Sdn Bhd (CHSB), a wholly-owned subsidiary of the property group. The IRB has also withdrawn its winding up petition against CHSB, which was accordingly struck out by the High Court. (The Edge Daily)

• Paramount Corporation Bhd’s 2Q2017 net profit declined 38.6% Y.o.Y to RM14.7 mln, mainly on lower profit contribution from its property segment. Revenue for the quarter, however, increased 27.0% Y.o.Y to RM184.6 mln.

• For 1H2017, cumulative net profit shrank 31.6% Y.o.Y to RM23.0 mln. Revenue for the period, however, rose 26.6% Y.o.Y to RM327.5 mln. (The Edge Daily)  

Source: Mplus Research - 17 Aug 2017