Market Review

Malaysia:. The FBM KLCI (+0.3%) rebounded from the previous two session slump, underpinned by Press Metal (+17.0 sen), but the key index still recorded -1.8% WoW decline as the daily Covid-19 cases remains above the 4k mark. The lower liners remained downbeat, while the broader market closed mostly lower.

Global markets:. The US stockmarkets rebounded as the Dow gained 1.0% after US President Joe Biden’s struck a USD579.0bn infrastructure plan with a bipartisan group of senators, whilst the final reading of 1Q21 GDP was unchanged at +6.4% YoY. European stockmarkets rebounded, while Asia stockmarkets closed mixed.

The Day Ahead

The FBM KLCI moved a tad high alongside the uptrend move in the regional markets on the back of bargain hunting after the key index closing at the year’s low in its previous session. The lower liners and broader market which were traded in a negative bias tone suggesting that investors are still cautious. The local bourse may see another round of pullback following the extension of the MCO3.0 as Covid-19 cases remained above the 4k mark. Meanwhile, investors may look ahead to the announcement of assistance schemes from the government, as well as the OPEC meeting scheduled for 1st July 2021.

Sector focus:. With the lockdown extension, traders may focus on sectors that will benefit from the current situation such as packaging and transportation & logistics. Meanwhile, tracking the Nasdaq move last week, buying interest may be seen in selected technology stocks on the local front. Energy stocks could see potential trading interest amid the firm Brent oil price that holding above USD75.

The FBM KLCI staged a mild rebound with some improvement in volume after hitting the lowest point in 2021 in the previous session. Technical indicators remained negative as the MACD Histogram has extended a red bar, while the RSI hovered below the 50 level. With that, the key index may continue to trade between its support level at 1,550 and its resistance level at 1,580.

Company Brief

Serba Dinamik Holdings Bhd has lost almost half of its board members in the latest twist to the company's rapid fall from grace. Filings with Bursa Malaysia today showed that five of its independent and non-executive directors have resigned, with four of them stating their disagreement over Serba Dinamik's decision to take legal action against its former external auditors as their reasons for leaving. The four independent directors are Datuk Seri Tengku Hasmuddin Othman, Hasman Yusri Yusoff, Sharifah Irina Syed Ahmad Radzi and Rozilawati Basir. (The Star)

My E.G. Services Bhd has signed a letter of intent (LOI) to purchase 10.0m doses of Anhui Zhifei Biopharmaceutical Co Ltd’s Covid-19 vaccine, ensuring that the corresponding quantity of its recombinant protein subunit vaccine is reserved for delivery as early as August 2021. MYEG holds three-year rights to exclusively distribute the vaccine in Malaysia while through a separate partnership, the group has two-year exclusive distribution rights to the vaccine in the Philippines and is presently in discussions to distribute in other countries. The cost of the vaccine will be determined later subject to the conditional authorisation by NPRA. (The Star)

Yinson Holdings Bhd’s 1QFY22 net profit jumped 138.3% YoY to RM112.0m, driven mainly by the engineering, procurement, construction, installation and commission (EPCIC) segment, while revenue surged 288.4% YoY to RM992.0m. (The Star)

Leong Hup International Bhd (LHI) is ramping up its business-to-consumer channel via Baker’s Cottage in Malaysia and it targets to have 280 by end-2023 (136 outlets have opened to-date), while it also expands its downstream operations in Southeast Asia. The group anticipate an improvement in performance across their markets in 2021, supported by the ongoing vaccine narrative and favourable demand-supply dynamics. (The Star)

IOI Corp Bhd has taken note of the US Customs and Border Protection's (CBP)

letter to migrant worker rights specialist Andy Hall to whom the agency indicated that it had acknowledged the receipt of a petition providing information on alleged forced labour at IOI Corp's operations in Malaysia. (The Edge)

HB Global Ltd has received its shareholders' approval for the proposed acquisition of a 60.0% stake in 5G infrastructure firm Forward Resources and Construction Sdn Bhd worth RM66.0m. The group’s shareholders have also approved the proposed diversification into construction and engineering solution services which offer a new revenue and income stream for the group and provide a sustainable long-term earnings growth potential. (The Edge)

Malaysia Airports Holdings Bhd (MAHB) will need to confirm with the government on the approval to implement its RM1.30bn Subang Airport Regeneration Plan, as the matter is not specifically stated in the statements issued by the Finance and Transport Ministries. So far, MAHB is still the responsible party to develop assets surrounding the Sultan Abdul Aziz Shah Airport (Subang Airport) in Subang, Selangor. (The Edge)

MyNews Holdings Bhd's 2QFY21 net loss widened to RM10.3m, compared with a net loss of RM2.3m recorded in the previous corresponding quarter, affected by uncertainties and random standard operating procedures (SOP) changes to critical business elements such as the permissible business hours. Revenue for the quarter fell 15.8% YoY to RM103.9m. (The Edge)

Source: Mplus Research - 28 Jun 2021