Holding up well

Market Review

Malaysia:. The FBM KLCI (+0.1%) managed to extend its positive trend as the key index recovered from its intraday low, lifted by strong buying support from foreign institutional players. The lower liners also marched higher, while the technology sector (+1.9%) outperformed the mixed broader market.

Global markets:. The US stockmarkets extended their gains as the Dow added 1.0%, boosted by the optimism surrounding the prospect of a short-term US debt limit extension with focus now shifting towards the unemployment date. Both the European and Asia stockmarkets closed on an upbeat note.

The Day Ahead

The FBM KLCI rose for the third consecutive session as the key index raced higher into the closing bell, in tandem with regional peers that tracked the overnight Wall Street rally. The key index may continue to track the positive sentiment in Wall Street given the fading US debt ceiling worries, coupled with the interstate border reopening talks as well as the firmer crude oil price, which has rebounded and is trading above the USD81 per barrel level. Meanwhile, the CPO price saw a mild pullback. Besides, we believe traders may lookout for sector that may benefit under the Budget 2022, which will be tabled at the end of this month.

Sector focus:. We reckon the energy sector may remain attractive to investors with the crude oil price climbing higher. Besides, recovery theme sector such as aviation and consumer may still bode well under the recovery scenario. Also, the technology and telco sectors may mirror the rally in Nasdaq overnight and we believe both sectors are potential beneficiaries under the Budget 2022.

FBMKLCI Technical Outlook

The FBM KLCI extended rally for a third session, crossing above the resistance level at 1,560. Technical indicators turned positive as the MACD Histogram has extended a green bar, while the RSI continued hovered above the 50 level. Should the key index hold above 1,560, the next resistance is pegged along 1,580-1,600. Support is located at 1,520.

Company Brief

Ireka Corp Bhd's subsidiary Ireka Engineering & Construction Sdn Bhd secured a contract from Fec Telco Sdn Bhd with a provisional sum of RM196.0m for the fibre to-the-home connectivity project in Langkawi, Kedah. The contract will be undertaken in two sections over a period of two years. (The Star)

Crest Builder Holdings Bhd's unit Crest Builder Sdn Bhd has secured a RM192.0m contract from Allevia Sdn Bhd for the construction of a condominium project in Mukim Batu, Kuala Lumpur. The project involves the construction of a 45-storey condominium with 159 units and a 40-storey condominium with 135 units, an underground carpark, carpark podium and recreational facility. The project will commence from 1st December 2021 to 31st October 2024. (The Star)

Malayan Banking Bhd (Maybank) has signed a Letter of Intent with Tenaga Nasional Bhd's wholly-owned subsidiary TNBX Sdn Bhd to purchase Malaysia Renewable Energy Certificates (mRECs), equivalent to 70.0% of its Malaysian operations' Scope 2 carbon emissions. This will make Maybank the first bank in Malaysia to purchase these non-tangible energy commodities to support renewable energy generation as part of its sustainability goals. (The Edge)

BIMB Holdings Bhd will be delisted from the Main Market of Bursa Securities and Bank Islam will assume the listing status of BIMB with effect from 9.00am today. Bank Islam will be assuming the existing stock short name, stock code, and the international securities identification number (ISIN) code of BIMB. (The Edge)

Fast Energy Holdings Bhd has secured an RM11.8m contract to supply solar power to a furniture company. Apex Group will purchase the electricity produced by solar photovoltaic systems at a rate of 30 sen kW/h for a 25-year period. (The Edge)

Dynaciate Group Bhd is acquiring an 8.0-ac piece of industrial land in Serendah, Selangor, from Brem Holdings Bhd for RM10.1m. The acquisition is in line with its strategy to grow its land bank at strategic locations for future development into industrial buildings such as warehouse and factory. (The Edge)

Source: Mplus Research - 8 Oct 2021