• The FBM KLCI (+0.6%) extended its winning streak to its fourth consecutive day yesterday after the key index lingered mostly in the positive territory in line with the positivity in regional stockmarkets as the threat of a trade war ebbs. The lower liners – the FBM Small Cap (+4.3%), FBM Fledgling (+3.1%) and FBM ACE (+6.8%) all trended sharply higher amid bargain hunting activities from the previous months’ selloff, while the broader market closed positively.

• Market breadth stayed positive as advancers overpowered decliners on a ratio of 955-to-221 stocks. Traded volumes rose 68.2% to 3.73 bln shares as investors bargain hunt on beaten down stocks.

• Nestle (+50.0 sen) led by the key index advancers list, followed by Press Metal (+29.0 sen), Sime Darby Plantation (+28.0 sen), AmBank (+18.0 sen) and Hong Leong Financial Group (+14.0 sen). Amongst the biggest advancers on the broader market were KESM Industries (+RM2.20), Ajinomoto (+54.0 sen), Unisem (+36.0 sen), MPI (+34.0 sen) and Lotte Chemical Titan (+33.0 sen).

• In contrast, BAT (-26.0 sen), Genting Plantations (-18.0 sen), Ayer Holdings (- 15.0 sen), Heng Yuan (-13.0 sen) and Petron Malaysia (-11.0 sen) topped the broader market decliners list. Key loser on the big board were Hap Seng (-15.0 sen), Petronas Gas (-10.0 sen), Petronas Chemicals (-3.0 sen), YTL Corporation (- 2.0 sen) and IHH (-2.0 sen).

• Asian benchmark indices extended their gains after China’s President Xi Jinping continues to back globalisation, calming the concern over a trade war. Both the Shanghai Composite and Hang Seng Index jumped 1.7% each, while the Nikkei added 0.4% after recovering all its intraday losses. ASEAN stockmarkets, meanwhile, closed higher yesterday.

• U.S. stockmarkets extended their gains overnight as the Dow (+1.8%) surged amid the easing concern of trade war between China and U.S. On the broader market, the S&P 500 added 1.7% with all eleven major sectors in the positive, while the Nasdaq jumped 2.1% higher to close above the 7,000 psychological level.

• Earlier, European stockmarkets – the FTSE (+1.0%), CAC (+0.8%) and DAC (+1.1%), all extended their gains, lifted by the improved developments in the U.S.- China trade dispute. Notable advancers include basic material stocks like Anglo American (+5.1%), BHP Billiton (+3.5%) and Rio Tinto (+3.1%).

The Day Ahead

• We maintain our view that Malaysian stocks will continue to head higher over the near term in tandem with the gains in most global stock indices. The ebbing concerns over a trade war will provide an additional impetus for the Malaysian equities ‘sustained uptrend.

• Similarly, we also see further recovery among the lower liners and broader market shares after they endured sharp declines over the past two months that has left many stocks oversold. The bargain hunting activities will also prevail amid the improved global stockmarket sentiment, although there could be increased quick profit taking activities after many stocks have climbed significantly in the past session.

• The continuing upsides could see the key index making a fresh attempt at the 1,870 after it cleared the 1,860 level yesterday. On the downside, the main support for now is at the 1,850 level.

COMPANY BRIEF

• TSR Capital Bhd is paying Kwasa Land Sdn Bhd, the master developer of the Kwasa Damansara township in Selangor, about RM58.9 mln for the development rights and revenue sharing of a proposed residential development known as Plot R3-3 at the township. With a gross development value (GDV) of RM295.0 mln, the development will feature 260 residential units that include villas and condominiums, which is expected to be completed in 2024.
• In consideration of the development rights, TSR will pay Kwasa Development RM39.8 mln and a sum which is equivalent to 6.5% of the gross sales value. (The Star Online)

• Vertice Bhd has secured a subcontract worth RM339.9 mln to construct and complete the mainline and other associated works of the Sungai Besi-Ulu Kelang (SUKE) elevated expressway, from San Mutual Majujaya (SMM) Sdn Bhd. The 19-month project will commence from the date of possession of the site on 16th April 2018. This marks the group’s largest construction project todate. (The Star Online)

• Prestariang Bhd announced that it has fulfilled all the conditions prevalent to a concession agreement entered into with the Government of Malaysia to implement the Immigration Department’s Sistem Kawalan Imigresen Nasional (SKIN) or National Immigration Control System.

• To recap, the concession agreement was signed on 18th July 2017 by Prestariang SKIN Sdn Bhd (PSKIN) — a wholly-owned unit of Prestariang's 70.0%-owned subsidiary, Prestariang Services Sdn Bhd (Pservices) — with the Home Affairs Ministry. (The Edge Daily)
• YFG Bhd was awarded a RM55.0 mln contract to build 418 units of singlestorey houses for the Angkatan Tentera Malaysia housing scheme in Tampin, Negeri Sembilan, from Evergreen Platform Sdn Bhd. Contract works include the building, infrastructure and landscaping works, which are expected to start from 8th May 2018 until 8th May 2020. (The Edge Daily)

• Boustead Holdings Bhd has bagged a contract for the maintenance and upgrading of combat management system for a Royal Malaysian Navy vessel worth RM44.8 mln. The contract was awarded by the Ministry of Defence. (The Edge Daily)

• Sanichi Technology Bhd is acquiring a 70.0% stake in a Johor-based realty company, Persada Ternama Sdn Bhd, for RM8.0 mln to increase its earnings. The latter is involved in the business of land developers, builders, and contractors for construction and has a joint-housing and commercial development project with Lembaga Kemajuan Johor Tenggara (Kejora) – an agency under the Ministry of Rural and Regional Development Malaysia – on land parcels measuring 234 acres in Kota Tinggi. (The Edge Daily)

• Hap Seng Plantations Holdings Bhd has proposed a revision to its dividend policy to approximately 60.0% of its net profit, from “up to” 60.0% of its net profit previously.

• The dividend payment will, however, be dependant on its level of cash, gearing, return on equity, retained earnings, expected results of operations, projected levels of capital expenditure, as well as investment plans and working capital requirements. (The Edge Daily)

• Minetech Resources Bhd has fixed the issue price for the placement of 30.0 mln new shares at 10.0 sen per share, which will be the first tranche of the proposed 106.4 mln placement exercise.

• The issue price is at a premium of approximately 6.3% over the five-day volume weighted average market price of Minetech shares as at 9th April 2018.

• To recap, the group had proposed to undertake the private placement last December to fund its property development expenditure and working capital. (The Edge Daily)

• Destini Bhd is partnering with Felcra Bhd to provide maintenance, repair and overhaul (MRO) services for industrial facilities and equipment in agriculture and related industries across Malaysia and the Asean region. A joint-venture company (JVCo) between both parties will be incorporated within three months.

• The JVCo will provide MRO services to Felcra’s oil palm factories, commercial and residential properties, as well as other owners or operators in Malaysia and the Asean region. The JVCo will also offer other related engineering services. (The Edge Daily)

• Sasbadi Holdings Bhd has clinched two textbook publishing and printing contracts for Form 3 of the national secondary schools from the Ministry of Education (MoE), totaling RM5.8 mln.

• The first contract is to publish and print a Science textbook for RM4.8 mln, while the second contract relates to the publishing and printing of a Chinese language textbook for RM1.0 mln. The two contracts are for a period of two years, up until 31st December 2020. (The Edge Daily)
• MMC Corporation Bhd has announced that the Sabah State Economic Planning Unit (EPU) has turned down its proposal to acquire a 20.0% stake in Sabah Ports Sdn Bhd – the whollyowned subsidiary of Suria Capital Holdings Bhd. (The Edge Daily)  

Source: Mplus Research - 11 Apr 2018