Turning wobbly

Market Review

Malaysia:. The FBM KLCI (-0.1%) managed to recover most of its intraday losses, boosted by the second half buying support in selected index heavyweights. The lower liners, however, retreated, while the broader market closed mostly weaker with the plantation sector (-1.9%) underperformed.

Global markets:. Wall Street ended mostly lower as the Dow finished flat after erasing all its intraday gains, while the S&P 500 (-0.7%) and Nasdaq (-2.0%) were dragged down by the selloff in technology sector. The European stockmarkets extended their gains, but and Asia stockmarkets closed mixed.

The Day Ahead

With the rising Covid-19 cases in China as well as the unresolved geopolitical tension between Ukraine-Russia, we believe overall global sentiment may continue to stay volatile and downside risk may persist in the regional stock markets. Several upcoming catalysts for traders to monitor include (i) Russia-Ukraine ongoing negotiations, (ii) upcoming interest rate decision in the US, and (iii) the spike in Covid-19 cases in China, which may affect the manufacturing sector at least in the near term. Hence, investors may stay defensive at least for this week. On the commodity markets, the crude oil price retreated further to around USD105, while the CPO price traded around RM6,300.

Sector focus:. Given the weakness in Nasdaq overnight, selling pressure may persist in the technology sector. Meanwhile, the consumer and banking stocks may outperform amid the reopening of travel borders, which should bode well for the economic recovery. We expect the O&G and plantation sector to take a breather after recent rallies as the commodity prices are cooling off.

FBMKLCI Technical Outlook

The FBM KLCI stayed below the daily EMA20 level after closing with marginal losses. Technical indicator remained weak as the MACD Histogram was still below zero, while RSI hovered below 50. The resistance is envisaged around 1,570-1,580, while the support is set at 1,550, followed by 1,540.

Company Brief

Complete Logistic Services Bhd (CLSB) has proposed for a change of name to Hextar Technologies Solutions Bhd, in line with its diversification into the information and communications technology (ICT) solutions and services. The company has been contemplating an alternative income stream to mitigate the risks of solely relying on the existing businesses. Meanwhile, CLSB has entered into a share sale agreement for the disposal of 36.0m ordinary shares and 18.0m warrants in Classic Scenic Bhd (CSCENIC) with Hextar Group chief executive officer Datuk Ong Choo Meng for RM32.0m. Based on the disposal consideration, the group is expected to record a pro forma gain of approximately RM2.7m. (The Star)

Minetech Resources Bhd’s wholly-owned subsidiary of Minetech has secured a contract worth RM9.5m from GLM Emerald Square (Cheras) Sdn Bhd. The contract was for the execution and completion of external link bridge, covered walkway and associated works for the proposed Emerald 9 Cheras Development in Cheras. The project commenced on 1st March 2022 and shall be completed by 28th February 2023. (The Star)

Former GrabPay Southeast Asia managing director Ooi Huey Tyng has been appointed as an independent director of Maxis Bhd effective 30th March 2022. Uthaya Kumar A/L K Vivekananda who is currently an independent director of Bumi Armada Bhd, as well as chairman of its audit and risk management committees, has also been appointed as independent director effective 30th March 2022. (The Edge)

Hong Seng Consolidated Bhd has announced the resignation of its executive director Kenny Khow Chuan Wah to pursue his personal and other work commitments. Khow, who was appointed to the board in 2018, directly holds 10.3m shares in Hong Seng. (The Edge)

Cahya Mata Sarawak Bhd has appointed Mukhnizam Mahmud as the group's acting chief financial officer, effective 15th March 2022. Mukhnizam, 56, has more than 30 years of experience with companies in Malaysia, Singapore and Indonesia in roles involving accounting/finance and general management. (The Edge)

Reservoir Link Energy Bhd (RL) has received a letter of award for the engineering, construction and commissioning (ECC) of a 11.0MW large scale solar photovoltaic plant to be located in Perak. RL’s 51%-owned subsidiary Founder Energy Sdn Bhd has landed the project valued at RM14.9m from Atlantic Blue Sdn Bhd, a wholly owned subsidiary of Solarvest Holdings Bhd. (The Edge)

Source: Mplus Research - 15 Mar 2022