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Mplus Market Pulse - 8 Dec 2021

Publish date: Wed, 08 Dec 2021, 08:47 AM
An official blog in I3investor to publish research reports provided by Malacca Securities research team.

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Turning point

Market Review

Malaysia:. The FBM KLCI (+1.0%) managed to recover most of its previous session losses, lifted by better performances from more than two-thirds of the key index components. The lower liners also rebounded, while broader market ended mostly positive, anchored by the financial services sector (+1.3%).

Global markets:. US stockmarkets delivered another solid performance as the Dow (+1.4%) extended its gains, driven by optimism that Omicron variant may not derail economic growth prospects. Also, European stockmarkets marched higher, while Asia stockmarkets closed on a positive note.

The Day Ahead

The FBM KLCI rebounded from Omicron-induced selloff earlier, led by banking heavyweights and window dressing activities may have started. We reckon the overnight rally at Wall Street may spill over to the local bourse amid fading concerns over the Covid-19 Omicron variant. Besides, market may keep an eye on China’s economic data (inflation and PPI) which will be releasing on Thursday. On the local front, the government will be deciding on the 5G wholesale model by Jan- 2022 and aims to reach 80% of the populated areas with 5G roll-out may benefit the telecommunication sector. Commodities wise, the crude oil price advanced to close above the USD75 per barrel mark, while the CPO price extended gains.

Sector focus:. Buyers may focus on the oil & gas counters in view of the rebounding crude oil price. Besides, the technology sector may see buying interest building up, mirroring the overnight rally in Nasdaq.

FBMKLCI Technical Outlook

The FBM KLCI rebounded, but still hovering below the critical 1,500 level. Technical indicators are mixed at this juncture as the MACD Histogram has extended a negative bar, while the RSI has hooked above 30 (oversold) level. The support level is located at 1,480, while the next resistance is pegged along 1,500-1,520.

Company Brief

Ireka Corp Bhd's unit Ireka Development (Terengganu) Sdn Bhd has accepted a RM468.0m contract from the Terengganu state government to develop through privatisation affordable and mixed housing development in the Kemaman district of the state. Ireka will undertake the mixed development and related works on 200.0-ac of government land in Bandar Baru Kertih Jaya, Mukim Kertih in Kemaman. (The Star)

TAFI Industries Bhd has proposed to undertake a bonus issue of up to 253.0m new ordinary shares on the basis of two bonus shares for every one share held in the company. TAFI also proposed a bonus issue of up to 63.2m warrants on the basis of one warrant for every two existing shares held. (The Star)

Yinson Holdings Bhd has issued the entire RM1.00bn sustainability-linked sukuk wakalah programme, which it said represents Malaysia’s first-ever sustainability linked sukuk. The issuance, which has a tenure of five years and profit rate of 5.6%, was upsized from an initial target of RM700.0m on the back of a robust orderbook of RM1.66bn. (The Edge)

Atlan Holdings Bhd has acquired the remaining stake, representing 15.0% shareholding plus one share, in duty-free retail arm DFZ Capital Sdn Bhd for RM45.8m from Heinemann Asia Pacific Pte Ltd. DFZ has outlets in various locations in Peninsular Malaysia including Padang Besar, Langkawi, Bukit Kayu Hitam, KLIA and Johor Bahru. (The Edge)

Cypark Resources Bhd has inked a Memorandum of Understanding with Huawei Technologies (Malaysia) Sdn Bhd for long-term cooperation on a total of 500.0-MW renewable energy projects in and outside of Malaysia on an exclusive basis. Under the deal, Huawei would act as the technology enabler and would provide the technical and after-sales support for all products and solutions while Cypark would be the user and installer of the products and solutions. (The Edge)

CIMB Group Holdings Bhd has disposed of 25.0% of its shareholdings in both CGS CIMB Securities International Pte Ltd (CSI) and CGS-CIMB Holdings Sdn Bhd (CCH) respectively to China Galaxy Securities (CGS). CSI and CCH are the holding companies of CIMB's stockbroking joint venture with CGS, known as CGS-CIMB Securities. (The Edge)

Daibochi Bhd’s 1QFY22 net profit declined 23.4% YoY to RM9.8m, mainly due to higher raw material prices, freight cost and Covid-19 related expenses. Revenue for the quarter, however, increased 15.1% YoY to RM180.3m. An interim dividend of 2.5 sen per share, payable on 10th January 2022 was declared. (The Edge)

ATA IMS Bhd has reported that nearly 300 of its workers resigned in the first week of December after the company implemented a "zero overtime on Sunday" policy. Clarifying a report by Reuters, ATA IMS company policy strictly adheres to Malaysian labour law, which permits up to 104 hours on normal working days in a month. (The Edge)

Axiata Group Bhd has redesignated former Khazanah managing director Tan Sri Shahril Ridza Ridzuan as its new chairman effective 1st January 2022, replacing Tan Sri Ghazzali Sheikh Abdul Khalid, who is retiring on 31st December 2021. (The Edge)

Inari Amertron Bhd will be an addition to FTSE Bursa Malaysia KLCI Index and will be a deletion from FTSE Bursa Malaysia Mid 70 Index and the FTSE Bursa Malaysia KLCI Reserve List. (The Edge)


Source: Mplus Research - 8 Dec 2021

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