• The FBM KLCI (-0.1%) dipped for the ninth consecutive trading session amid the unabated selling pressure by foreign funds. Consequently, the Main Board also closed 0.9% W.o.W lower, slightly above the 1,755.0 psychological mark. The lower liners mostly advanced, however, with the exception of the FBM Small Cap (-0.2%), while the broader market finished broadly in the positive territory.

• Market breadth returned to negative as losers overcame gainers on a ratio of 506-to-328 stocks. Traded volume, however, lost 12.3% to 2.02 bln shares, amid the cautious market sentiment.

• Top losers on the Main Board included BAT (-76.0 sen), Hong Leong Financial Group (-20.0 sen), Public Bank (-14.0 sen), Petronas Gas (-10.0 sen) and IHH Healthcare (-4.0 sen). Broader market decliners, meanwhile, were Apex Equity (- 13.0 sen), Kumpulan H&L High-Tech (- 12.0 sen), MFCB (-12.0 sen), Pentamaster (-12.0 sen) and Genting Plantations (- 10.0 sen).

• On the other side of the field, consumer products giant Dutch Lady (+RM1.06) advanced, followed by KESM Industries (+40.0 sen), Panasonic Manufacturing (+40.0 sen), Magni-Tech (+28.0 sen) and SP Setia (+24.0 sen). Meanwhile, KLCC (+20.0 sen), Telekom Malaysia (+16.0 sen), Astro (+11.0 sen), Hong Leong Bank (+8.0 sen) and Westports (+8.0 sen) outperformed its peers on the key-index.

• Tracking the strong performance of U.S. stockmarkets overnight, key regional benchmark bourses finished mostly higher as investors digested the hawkish stance of the U.S. Federal Reserve. The Nikkei, however, opposed as it inched into the red, weighed down by exporters in-tandem with the mild pullback in the Dollar. The Shanghai Composite index rose 0.3% - led by expectations of reforms on state-owned enterprises, while the Hang Seng gained 0.5%. ASEAN stockmarkets also ended on an upward bias on Friday’s close.

• U.S. stockmarkets minted fresh record highs, buoyed by the strength in technology stocks. The Dow was up by 0.1% on increasing expectations of an interest rate hike in December. Similarly, on the broader market, the S&P 500 and the Nasdaq posted gains for the third consecutive day after adding 0.4% and 0.7% respectively.

• European stocks finished higher on the last trading day of September as investors adjusted to the improved global sentiment and a string of economic releases. The FTSE and the CAC notched 0.7% in gains, while the DAX (+1.0%) extended its winning streak for the fifth straight session to 12,828.9 points.

The Day Ahead

• The Malaysian stockmarket ended the quarter on a low note with few inklings of a rebound as yet. Nevertheless, we think that a recovery is already due to the oversold market conditions and the key index is already approaching its major support level around the 1,750 level, which we believe should provide a firm support level.

• Any rebound, however, is likely to be mild for now, given that there are few significant catalysts to give the key index a strong kicker for now. Therefore, there will still be significant trepidation on market players’ part to renew their buying interest and any recovery is likely to be limited to the 1,760 level for now.

• The broader market environment is also subdued with few fresh leads to entice retail players to take up bigger positions and we see the mixed-to-lower market environment also prevailing for now.

Company Brief

• Trive Property Group Bhd has proposed a bonus issue on the basis of 1 new sharefor-every 6 existing Trive shares held on an entitlement date to be determined later. The actual number of bonus shares to be issued will also depend on the total issued Trive shares on the entitlement date. In addition, the company may issue up to 500.0 mln Trive shares to Macquarie Bank Ltd. (The Edge Daily)

• Dayang Enterprise Holdings Bhd has won a five-year contract from Petronas Carigali Sdn Bhd to provide maintenance, construction and modification (MCM) services for Package A (Offshore) — Sarawak Oil, for an undisclosed sum. The contract expires on 19th September 2022 will involve works related to topside structural maintenance, workover preparation and facilities improvement project, said Dayang. The five-year contract has a one-year extension option. (The Edge Daily)

• Serba Dinamik Holdings Bhd has secured seven contracts in August and September worth an estimated RM206.0 mln. They comprise three operations and maintenance contracts, and four engineering, procurement, construction and commissioning (EPCC) contracts, with contract period ranging between 6 months and 10 years. (The Edge Daily)

• Maxwell International Holdings Bhd, whose unit is facing some 14 lawsuits in China, says it needs two more months to check into the litigations. It warned that the number of cases and the amounts claimed, which it previously said might come up to some 272.2 mln yuan (RM173.0 mln), are expected to be more than what the company was initially made aware of. (The Edge Daily)

• DRB-Hicom Bhd has completed the disposal of a 49.9% stake in Proton Holdings Bhd to China’s Zhejiang Geely Holding Group Co Ltd, which has nominated its subsidiary Geely International (Hong Kong) Ltd to hold the shares it bought. Proton has also completed its disposal of its 51.0% stake in Lotus Advance Technologies Sdn Bhd to Zhejiang Geely, and the remainder 49.0% to Etika Automotive Sdn Bhd, which is controlled by tycoon Tan Sri Syed Mokhtar al-Bukhary.

• Separately, DRB-Hicom announced that Dr Li Chunrong from Geely will be the new CEO of Proton’s manufacturing arm, Perusahaan Otomobil Nasional Sdn Bhd, succeeding Datuk Ahmad Fuaad Kenali, from 1st October 2017. (The Edge Daily)

• Astino Bhd’s 4QFY17 net profit declined 40.0% Y.o.Y to RM5.1 mln due to higher allowance for diminution in value of inventories in the quarter under review. Revenue for the quarter, however, rose 11.6% to RM124.8 mln.

• For FY17, cumulative net profit increased 13.5% Y.o.Y to RM34.4 mln. Revenue for the year added 5.9% Y.o.Y to RM500.6 mln. (The Edge Daily)

• Borneo Oil Bhd’s 2QFY18 net profit declined 6.9% Y.o.Y to RM4.1 mln, mainly due to lower fair value gains from its gold trading business. Revenue for the quarter sank 98.2% Y.o.Y to RM19.4 mln.

• For 1HFY18, cumulative net profit decreased 38.2% Y.o.Y to RM9.3 mln. Revenue in the period slumped 98.3% Y.o.Y to RM42.7 mln. (The Edge Daily)
   
• Cypark Resources Bhd’s 3QFY17 net profit rose 24.1% Y.o.Y to RM16.5 mln on better performance by its environmental engineering segment as well as its green technology and renewable energy segment. Revenue for the quarter rose 7.0% Y.o.Y to RM75.1 mln.

• For 9MFY17, however, net profit inched higher by 0.9% Y.o.Y to RM39.5 mln. Revenue for the period rose 10.3% Y.o.Y to RM237.5 mln. (The Edge Daily)

• LB Aluminium Bhd’s 1QFY18 net profit dropped 29.7% Y.o.Y to RM3.6 mln due to lower other operating income that fell from RM4.3 mln to RM0.9 mln, mainly due to a lower fair value gain of financial derivatives as well as a lower amount of reversal of impairment loss on receivables. Revenue for the quarter, however, grew 13.4% Y.o.Y to RM124.4 mln. (The Edge Daily)  

Source: Mplus Research - 2 Oct 2017