Market Review

Malaysia: The FBM KLCI (-0.6%) hovered in the negative territory for the entire trading session as the key index snapped a four-day winning streak yesterday. The lower liners, however, extended their gains, while the broader market closed mostly higher with the property and energy sector taking the lead; rising 2.0% each.

Global markets: Wall Street extended its gains as the Dow added 0.6% following the positive developments over the USD1.9tn stimulus bill, whilst the renewed rally in technology stocks sent the Nasdaq (+2.5%) sharply higher. European stockmarkets advanced, while Asia stockmarkets were mostly upbeat.

The Day Ahead

The FBM KLCI took a breather following its rally since last Friday, mainly dragged by the losses in NESTLE, Petronas-related counters and telecommunication heavyweights. Tracking the gains on Wall Street overnight after the US President Joe Biden signing the Covid-19 relief bill, we expect the local bourse to see some rebound amid growing optimism in the market, especially after a bash down in technology stocks recently. Meanwhile, we believe the lower liners should continue to move higher at this juncture. Commodities wise, the CPO price has climbed above the RM4,000 per tonne level, recorded at RM4,060.

Sector focus: We believe the recovery-theme sectors such as gaming, aviation, consumers, property and construction should continue to shine following the reopening of economic activities, coupled with the ongoing Covid-19 vaccination drive as investors are likely to price in their potential future earnings growth and attractive valuations. Besides, we reckon the plantation counters should see potential breakouts, riding on the firmer CPO price.

The FBM KLCI snapped its four-day winning streak. Given the technical indicators remained positive as the MACD Histogram has extended another green bar, while the RSI is hovering above 50, we reckon the pullback is likely to be temporary and the key index should continue its uptrend over the near term. Resistance is set around 1,650-1,660, while support is located at 1,600-1,620.

Company Brief

The government has extended its contract with Dagang Nexchange Bhd (DNeX) to provide e-services of the national single window (NSW) for trade facilitation. The extension starts on 1st September 2021 until 31st August 2024. DNeX has been the operator of the NSW for trade facilitation since the launch in 2009. (The Star)

Minetech Resources Bhd's wholly-owned subsidiary, Minetech Construction Sdn Bhd has entered into an agreement with Able Return Sdn Bhd and Damar Consolidated Exploration Sdn Bhd in relation to the contract renewal for waste removal, ore delivery, and associated works for an open pit mining estimated to be worth RM70.0m. The contract renewal was for the Selinsing gold mine project in Pahang, and it will be for a period of 36 months from 1st July 2020 to 30th June 2023. (The Star)

Bintai Kinden Corporation Bhd's subsidiary, Bintai Healthcare Sdn Bhd has signed a deal with Alrowad Medical Services to supply the Greenie Medi Cold Chain Box for the storage and distribution of Covid-19 vaccine in Saudi Arabia. Bintai Healthcare was appointed as the exclusive distributor for Greenie Medi Cold Chain Box by SLAB Asia Co Ltd in Malaysia, Saudi Arabia and the Philippines. (The Star)

Sime Darby Plantation Bhd (SDP) has commenced legal proceedings against Non Governmental Organisation Liberty Shared’s managing director Duncan Jepson to obtain information pertaining to a complaint filed by Jepson with the Securities Commission Malaysia against the planter. (The Edge)

FGV Holdings Bhd has expanded its animal feed and nutrition business by launching a new animal feed brand. The planter announced that its subsidiary FGV Integrated Farming Holdings Sdn Bhd has launched its animal feed brand, 'ALMA'. (The Edge)

Aimflex Bhd has committed to adopting a dividend policy of at least 30.0% of after tax profit for each financial year. The dividend payout would exclude any unrealised income from adjustments due to accounting policies that are non-cash in nature. (The Edge)

Pertama Digital Bhd executive director Sabri Abdul Rahman has emerged as a substantial shareholder in the group. Sabri has served a notification of his right through contract to take on an additional 115.0m shares, or 26.5% equity, in Pertama Digital. (The Edge)

MISC Bhd has secured seven-year charter contracts from Shell for three newbuilding crude carriers, for operations in international waters. The contracts were secured by AET Inc Ltd, the vessel-owning entity of petroleum shipping firm AET Tanker Holdings Sdn Bhd, which is in turn wholly-owned by MISC. (The Edge)

Boustead Plantations Bhd announced four new appointments to its board yesterday. Boustead Holdings Bhd deputy group managing director Izaddeen Daud is among the new board members. Izaddeen, as well as Boustead Holdings group finance director Fahmy Ismail and the group’s chief reinvention and strategy officer Ahmad Shahredzuan Mohd Shariff, have been named as non-independent non executive directors of the plantation company. Meanwhile, Datuk Mustaffar Kamal Abdul Hamid has been appointed as an independent non-executive director. (The Edge)

Genting Malaysia Bhd (GenM) bought back 2.0m shares on the open market yesterday as the casino operator’s share price climbed to a 13-month high of RM3.15. The latest purchase raised its net outstanding treasury shares to 286.8m, equivalent to 4.8% (The Edge)

Source: Mplus Research - 12 Mar 2021