Market Review

Malaysia:. The FBM KLCI (-0.1%) retreated after trading in a rangebound manner amid the lack of fresh leads, despite vaccination rate continues demonstrate positive progress. Both the lower liners and broader market ended mixed with the plantation sector (-1.1%) recorded its third straight day of decline.

Global markets:. The US stockmarkets retreated as the Dow fell 0.3% on concern over the tapering of bond buying ahead of the two-day US Federal Reserve meeting. European stockmarkets were upbeat, while Asia stockmarkets ended mixed.

The Day Ahead

The FBM KLCI finished a see-saw session mildly lower after bargain hunting activities emerged in the previous session as market sentiment remained cautious prior to the National Recovery Plan announcement. We expect the projection that Malaysia might gradually open up the economy by September according to the announcement, coupled with the accelerating daily vaccination rate in the country to lift the market sentiment on the local front. Commodities wise, the CPO price rebounded after a sixth-session decline, while the Brent oil price stayed firmly above USD73.

Sector focus:. Investors may focus on packaging and plastic related counters as products ASP in the sector is on a rising trend on the back of higher resin prices. Besides, the energy sector may gain traction in line with the persistent rise in oil price. Also, we believe technology stocks may continue its rebound following yesterday’s move.

The FBM KLCI continued the stay in consolidation as the key index closed below the EMA20 level. Technical indicators remained mixed with the MACD Histogram extended a green bar, while the RSI is below 50. We believe the key index may consolidate sideways with the resistance set along 1,600-1,610, while the support level is envisaged around 1,555-1,565.

Company Brief

Berjaya Corp Bhd's group chief executive officer Jalil Rasheed is laying the groundwork for the company to dispose RM5.00bn worth of non-core assets over the next five years and to halve its current debts of RM5.00bn in three years. He is unveiling his three-year strategic plan as the diversified group would be reorganised into five key business areas; retail, food & beverage, property, hospitality and services that includes gaming, environment, digital services and financial technology. (The Star)

Axiata Group Bhd has reported that the group and Telenor Asia have completed the due diligence works pertaining to the proposed merger between Celcom Axiata Bhd and Digi.Com Bhd, and will be signing definitive agreements soon. Both parties are hopeful of signing the agreements within a matter of days or a week. (The Edge)

VS Industry Bhd’s 3QFY21 net profit stood at RM73.4m vs. a net loss of RM26.9m recorded in the previous corresponding quarter, due to higher contribution across all of its business segments. Revenue for the quarter jumped 112.6% YoY to RM1.07bn. A third interim dividend of 0.8 sen, payable on 30th July 2021 was declared. (The Edge)

UWC Bhd’s 3QFY21 net profit rose 57.9% YoY to RM23.0m, following higher earnings from its semiconductor and life science segments. Revenue for the quarter increased 28.7% YoY to RM71.8m. (The Edge)

Poh Kong Holdings Bhd’s 3QFY21 net profit stood at RM24.0m vs. a net loss of RM2.3m registered in the previous corresponding quarter, due to higher revenue and cost control initiatives. Revenue for the quarter surged 223.8% YoY to RM364.2m. (The Edge)

Rosland Othman, group managing director and CEO of integrated civil construction service provider Sarawak Consolidated Industries Bhd, has ceased to be a substantial shareholder of ES Ceramics Technology Bhd after disposing of 25.4m shares in the latter on 11th June 2021. Out of the total, 12.9m were direct shares and 12.5m were indirect shares via private vehicle Vintage Capital Sdn Bhd. (The Edge)

TRC Synergy Bhd's unit has secured a RM43.0m maintenance contract from BHIC Submarine Engineering Services Sdn Bhd to maintain the Royal Malaysian Navy Submarine Base in Kota Kinabalu. Its wholly-owned Trans Resources Corp Bhd accepted the two-year award on 28th May 2021. (The Edge)

The mandatory take-over offer of Can-One Bhd closed yesterday with no takers from minority shareholders. With this, ultimate offeror, Yeoh Jin Hoe and persons acting in concert (PACs) continue to hold a 60.6% stake in the can manufacturer. The takeover offer by Yeoh raised eyebrows as it was made at a steep discount of 15.82% or 47 sen to the prevailing share price of RM2.97 on 3rd May 2021, prior to the trading suspension of its shares. (The Edge)

Source: Mplus Research - 16 Jun 2021