Market Review

Malaysia: The FBM KLCI (+1.2%) remained up on Friday following the surge in the previous session prior to the Budget 2021 announcement and hoping for economic recovery next year. The lower liners finished higher, while the broader market ended mixed.

Global markets: US stocks ended the week mostly flat following the release lowerthan-expected unemployment rate data as investors’ sentiment were mixed ahead of the US presidential election outcome. The Dow (-0.2%) dipped, while the S&P 500 (-0.03%) and Nasdaq (+0.04%) finished little change. European stockmarkets ended mostly in lower, but Asia stockmarkets finished mostly in green.

The Day Ahead

The all-rounded Budget 2021 that aims ensure sustainable living and rejuvenate economic activities is well received by majority which could provide a catalyst for further up strides. Foreign funds net buying rose to the highest level since midJanuary 2020, coupled with the diminishing uncertainties surrounding the US political situation will ensure stability, moving forward. The lower liners are expected to remain robust, owing to the positive market momentum that is driven by the resurgence in trading liquidity.

Sector focus: With the uncertainties surrounding the potential implementation of windfall tax were not imposed under Budget 2021, the healthcare sector that will remain in favour. Meanwhile, the historic high development expenditure amounted at RM69.0bn may anchor the recovery in the construction sector.

FBMKLCI Technical Outlook

The FBM KLCI marched higher for the third straight session as the key index closed above the daily EMA120 level for the first time in a month. With the 1,500 level remain well supported; the immediate resistance are now located at 1,530-1,540. In contrast, the supports pegged at 1,500, followed by 1,470. Indicators remained positive as the MACD Indicator has issued a Buy signal, while the RSI remains above 50.

Company Brief

Budget 2021 has proposed that the four leading rubber glove manufacturers in the country will contribute a total of RM400.0m towards efforts to combat the Covid19 pandemic. The four firms comprise Top Glove Corp Bhd, Hartalega Holdings Bhd, Supermax Corp Bhd and Kossan Rubber Industries Bhd. The companies have committed to help cover some of the costs, which include vaccine and medical equipment costs. (The Star)

LKL International Bhd has inked an agreement with AT Systematization Bhd to market, sell and distribute natural rubber latex gloves and nitrile gloves. The agreement is for an initial period of one year from the agreement date and renewable thereafter, in line with the expected commencement of AT subsidiary’s glove manufacturing in early December 2020. (The Edge)

Boustead Holdings Bhd’s managing director (MD) Datuk Seri Amrin Awaluddin will step down from his post on 15th November 2020 but gave no reason for his departure. The diversified conglomerate board of directors has commenced the formal process of identifying a candidate for the position. In the interim, Boustead's management team will be managing the day-to-day operations of the group. (The Edge)

Techfast Holdings Bhd has signed a letter of intent (LOI) to supply up to 6.5m barrels of diesel gas oil worth an estimated RM1.14bn. The LOI is for three years, starting 1st January 2021 until 31st December 2023. The estimated contract value is based on the present oil price. (The Edge)

Source: Mplus Research - 9 Nov 2020