Market Review

Malaysia: Gains in healthcare heavyweights and Petronas-related stocks boosted the FBM KLCI (+0.6%) to close above the 1,600 psychological level yesterday. The lower liners, however, retreated. The broader market ended mostly lower with the exception of Healthcare (+3.3%) and Industrial Products & Services (+0.8%) sectors.

Global markets: The US stockmarkets finished higher as the Dow (+0.9%) surpassed the 34,000 psychological level, boosted by the strong retail sales and manufacturing production data in March 2021 that expanded 27.7% YoY and 3.1% YoY respectively, coupled with the strong corporate earnings. European stockmarkets ended on a positive note, while Asia stockmarkets closed mixed.

The Day Ahead

The FBM KLCI marched higher to brush off the negative sentiment on the broader market, powered by the buying interest in glove counters as global Covid-19 cases ticked higher. Although the key index may trend higher in line with overnight gains in Wall Street, concerns over a possible fourth wave to hit the country may continue to dampen investors’ sentiment with the daily Covid-19 confirmed cases breaching the 2,000 mark yesterday. Commodities wise, both the CPO and oil prices climbed with the latter marking its fourth straight winning streak.

Sector focus: We expect to see follow-through buying interest in the glove counters given the rising Covid-19 daily confirmed cases in the country and across the globe. Besides, the positive sentiment in Nasdaq that surpassed 14,000 level may spill over to the technology stocks on the local front.

The FBM KLCI extended its gains to finish above the 1,600 psychological level and the daily EMA 20 level. Technical indicators turned positive as the MACD Histogram has turned into a green bar, while the RSI was hovering above the 50 level. Should the key index extended its uptrend move, the resistance is pegged along 1,615-1,635, while supported is set at 1,545-1,565.

Company Brief

WZ Satu Bhd’s wholly-owned subsidiary WZS Misi Setia Sdn Bhd has accepted a Letter of Award (LOA) from Malaysian Refining Company Sdn Bhd (MRCSB) for the provision of engineering, procurement, construction and commissioning of effluent management at source (EMAS) project valued at RM243.4m. The duration of the contract is for 27 months and is targeted to be completed on or before 30th June 2023. (The Star)

Former Kumpulan Wang Persaraan (Diperbadankan) (KWAP) CEO Datuk Wan Kamaruzaman Wan Ahmad has emerged as an independent non-executive director on the board of Malaysian Resources Corp Bhd (MRCB). Wan Kamaruzaman, 62, is also currently holding directorships at Al-Aqar Healthcare REIT and Al-Salam REIT, according to a bourse filing. (The Edge)

Electrical and mechanical engineering services provider Kejuruteraan Asastera Bhd (KAB) has appointed Datuk Dr Ong Peng Su as its independent non-executive chairman. He replaces investment banker-turn-investor Ian Yoong Kah Yin, who has resigned to pursue his personal interests. Yoong had assumed the role on 15th October 2019. (The Edge)

Guan Chong Bhd chairman Datuk Dr Mohamad Musa Md Jamil has resigned after 16 years in the role, citing other personal commitments as the reason for his departure. Guan Chong independent director Tan Ah Lai replaces Mohamad Musa in the role. (The Edge)

The public can now make digital payments beyond RM30,000 up to RM500,000 for court bails through Pertama Digital Bhd's application called eJamin. Permata Digital has announced that eJamin is a digital court bail payment solution. (The Edge)

UMW Holdings Bhd's automotive sales surged by 35.0% YoY in 1Q21 as UMW Toyota Motor (UMWT) and its associate company Perodua registered higher sales on the back of new model introductions as well as sales tax exemption, which is in place until 30th June 2021. UMWT sales increased by 60.6% YoY to 17,000 units in 1Q21. Meanwhile, Perodua sales rose by 28.8% YoY to 57,911 units. (The Edge)

Malayan Banking Bhd (Maybank) has reported that its 61st annual general meeting, which was supposed to be held yesterday, has been rescheduled due to a technical issue faced by remote participation and voting facility provider Tricor Investor & Issuing House Services Sdn Bhd. (The Edge)

7-Eleven Malaysia Holdings Bhd (SEM) has settled its lawsuit against the operator of Dego Ride. Under the amicable settlement recorded at the High Court, Dego Malaysia Sdn Bhd and its founder Nabil Feisal Bamadhaj are to pay SEM's whollyowned unit 7-Eleven Malaysia Sdn Bhd, and web service provider Qinetics Solutions Sdn Bhd, a sum of RM2.8m. (The Edge)

Paramount Corp Bhd’s wholly-owned Magna Intelligent Sdn Bhd is investing in a peer-to-peer (P2P) financing platform by acquiring a 30.0% stake in Omegaxis Sdn Bhd for RM13.7m, which the group sees as its entry point into the fintech sector. Omegaxis is a special purpose vehicle set up to facilitate Paramount’s proposed investment in P2P financing platforms, with the balance 70% stake in the vehicle to be held by P2P Venture Sdn Bhd, in which Paramount CEO Chew Sun Teong has direct equity interests of 29.5%, and 37.4% in redeemable convertible cumulative

Malayan Cement Bhd plans to raise RM227.0m via a private placement, based on an indicative price of RM2.67 per share, to be used for working capital and debt repayment. (The Edge)

Fajarbaru Builder Group Bhd has proposed to undertake a rights issue with free warrants to raise up to RM37.4m to fund the group’s existing and future construction projects and future property development projects, business expansion and future viable investment in the logging and timber trading, as well as plantation segments The rights issue of up to 373.9m shares will be on the basis of one rights share for every one existing share held, while a similar number of warrants will be issued on the basis of one warrant for every rights share subscribed. (The Edge)

LPI Capital Bhd's 1QFY21 net profit rose 5.6% YoY to RM82.3m, thanks to higher dividend incomes from equity investments. Revenue for the quarter increased 9.1% YoY to RM440.8m. (The Edge)

UEM Edgenta Bhd's subsidiary Edgenta Propel Bhd (EPB) is being sued for allegedly failing to complete an RM87.0m sub-contract under the Klang Valley Mass Rapid Transit's Putrajaya Line (MRT2) project. The suit was filed in the High Court by Ahmad Zaki Resources Bhd's unit, Ahmad Zaki Sdn Bhd (AZSB), which had awarded the sub-contract to EPB in 2016. AZSB is seeking RM23.8m in liquidated and ascertained damages and about RM5.0m in consequential damages. (The Edge)

Source: Mplus Research - 16 Apr 2021