Still On The Climb

• The FBM KLCI (+0.2%) registered its gains to sixth consecutive days after the last minute buying support in selected index heavyweights helped the key index to recover all its intraday losses. The lower liners – the FBM Small Cap (-0.6%), FBM Fledgling (-0.5%) and FBM ACE (- 1.0%), however, all retreated while the broader market closed mixed.

• Market breadth turned negative as decliners outpaced advancers on a ratio of 579-to-343 stocks. Traded volumes declined 29.8% to 3.27 bln shares as profit taking activities from recent gains emerged amongst the lower liners.

• Two-thirds of the key index components advanced, led by KLK (+50.0 sen), followed by Petronas Gas (+20.0 sen), Hong Leong Bank (+18.0 sen), Hong Leong Financial Group (+16.0 sen) and Axiata (+9.0 sen). Amongst the biggest gainers on the broader market were Batu Kawan (+36.0 sen), Transocean (+27.0 sen), Ajinomoto (+22.0 sen) and Far East Holdings (+20.0 sen) Sapura Energy added 4.0 sen after announcing a joint venture for a gas field development at Sarawak.

• Consumer products stocks like Dutch Lady (-48.0 sen), Carlsberg (-40.0 sen) Magni-Tech (-15.0 sen) and UMW Holdings (-7.0 sen) where the big losses on the broader market, while Cahya Mata Sarawak slipped 28.0 sen. Key losers on the key index were Nestle (-80.0 sen), Press Metal (-6.0 sen), Maybank (-6.0 sen), Sime Darby Plantations (-4.0 sen) and Digi (-3.0 sen).

• Asian benchmark indices extended their losses overnight on rising geopolitical tension in Middle East. The Nikkei edged 0.1% lower, while the Hang Seng Index (- 0.2%) halted its four day winning streak after erasing all its intraday losses. The Shanghai Composite declined 0.9%, dragged down by the weakness in financial and transportation stocks. ASEAN stockmarkets, meanwhile, closed mostly lower yesterday.

• Wall Street rebounded overnight as the Dow added 1.2% after President Donald Trump is considering re-joining the Trans-Pacific Partnership trade deal whilst geopolitical tension in Syria eased. On the broader market, the S&P 500 rose 0.8%, led by gains in the financial sector (+1.8%), while the Nasdaq finished 1.0% higher.

• Earlier, European stock indices - the FTSE (+0.02%), CAC (+0.6%) and DAX (+1.0%), all recovered from their intraday losses on signs of positive developments in the Middle East, nullify the slower growth in the Eurozone Industrial Production that rose 2.9% Y.o.Y in February 2018 – the slowest pace of expansion since October 2017.

The Day Ahead

• Once again, the late institutional support helped to haul the key index into the positive territory at the end of the yesterday’s trade in an otherwise mostly indifferent day. However, we see the near term positivity sustaining to the end of the trading week after global indices posted further recovery overnight that is likely to also buoy the local equity market and to end the week on a positive note.

• Local leads will remain far and inbetween, but there should be renewed buying on the lower liners and broader market shares on bargain hunting activities as these shares should still be on the recovery mode after their steep falls over the past two months that have also left them deep oversold.
• On the key index, the upsides are at the resistances of 1,875 and 1880 levels, while the supports are at 1,870 and 1,850 respectively.

COMPANY BRIEF

• Dolphin International Bhd has clinched a RM1.3 mln contract to supply, install and commission a clean air emission system - the Electrostatic Precipitator System (EPS), from Genting SDC Sdn Bhd (GSDC) for Genting Jambongan Oil Mill (GJOM) in Sabah. (The Edge Daily)

• MMS Ventures Bhd has secured the approval from the Securities Commission Malaysia (SC) to transfer its listing from the ACE Market to the Main Market of Bursa Malaysia. (The Edge Daily)

• Boustead Plantations Bhd, which is buying oil palm plantation land in Labuk and Sugut in Sabah, will increase the land's fresh fruit bunch yield to 17.0 tonnes a hectare over the next four years, from 11.0 tonnes a hectare currently and has earmarked RM250.0 mln as capital expenditure (capex) to fund the expansion. (The Star Online)

• Rex Industry Bhd has discarded its plans to raise RM20.8 mln via rights with bonus issue in view of the prevailing uncertain market conditions. Instead, it will consider funding its working capital and business investment/expansion plan(s) using internal funds and/or external borrowings. (The Edge Daily)

• Boustead Holdings Bhd expects normalised profit growth of about 20.0% in 2018, which will be driven by growth across most of its core business segments. The group's pretax profit exceeded the RM1.0 bln mark in 2017 at RM1.11 bln, after including RM555.0 mln in proceeds from the disposal of a plantation land. (The Star Online)

• N2N Connect Bhd is planning to buy a 28.0% equity stake in Australia's first hybrid marketplace lender for A$2.8 mln (or RM8.3 mln) cash. The latter uses the latest peer-to-peer lending technology in combination with traditional structured finance methods to fund high-yielding unsecured personal loans. (The Star Online)

• A unit of Iskandar Waterfront City Bhd (IWCity) is being brought to court by the Inland Revenue Board (IRB) for RM32.2 mln in additional taxes and penalties. The case is brought against its whollyowned subsidiary, Tebrau Bay Constructions Sdn Bhd (TBCSB). (The Edge Daily)

• Perak Transit Bhd has announced that Australian banking group, Macquarie Bank Ltd will not be subscribing for any more of its placement shares as it has issued a notice to terminate the conditional share subscription agreement previously signed. (The Edge Daily)

• Destini Bhd bagged a two-year umbrella contract to undertake well abandonment integrated services for Petronas Carigali Sdn Bhd, commencing from 29th March 2018 until 28th March 2020 with a one-year optional extension. (The Edge Daily)

• Malakoff Corp Bhd was awarded an operation and maintenance (O&M) contract with a large scale solar photovoltaic power plant (LSS) in Kota Tinggi, Johor, with a capacity of 29 MW. The contract work includes performing and providing services in relation to the operation, maintenance and repair of the solar plant for a period of 21 years starting from December 2018. (The Star Online)
• DRB-Hicom Bhd has appointed Sharifah Sofia Syed Mokhtar Shah as NonIndependent and Non-Executive Director effective 13th April 2018. Sharifah Sofia takes on the same role at Pos Malaysia Bhd, whose holding company is DRB-Hicom. Sharifah is the daughter of Tan Sri Syed Mokhtar AlBukhary, the major shareholder of DRBHicom Bhd.

• Meanwhile, Datuk Mohammad Zainal Shaari was appointed as NonIndependent and Non-Eecutive Chairman of the group, replacing Tan Sri Mohd Khamil Jamil who stepped down from the position on 1st April 2018. Datuk Mohammad Zainal has also been appointed to the same post at Pos Malaysia. (The Star Online)

• Kerjaya Prospek Group Bhd has won a contract worth RM357.3 mln for the main building works of the Bukit Bintang City Centre (BBCC) mixed development. The project involves the construction of a block of eight-storey car park podium, a six-storey car park and two towers (one 35 storeys and one 47 storeys), comprising a total of 666 service apartment units. (The Edge Daily)  

Source: Mplus Research - 13 Apr 2018