Choppiness prevails 

Market Review

Malaysia: The FBM KLCI (-0.01%) ended on a flattish note after erasing all its intraday gains on quick profit taking activities in Petronas-related heavyweights yesterday. The lower liners, however, closed mixed, while the broader market finished mostly higher, led by the technology sector (+1.3%).

Global markets: Wall Street retreated as the Dow (+0.2%) halted a four-day recovery, on fading optimism over the potential de-escalation of war in Ukraine and Russia and persisting concern over the inflation acceleration. The European stock markets closed mostly weaker, but Asia stock markets closed mostly higher.

The Day Ahead

The FBM KLCI ended flat, while more focus was seen in small cap and lower liners. As prospect of ending the Russia-Ukraine war remained uncertain following the little progress made on the peace talks earlier, we opine that the market will remain in a consolidation phase at least over the near term. However, investors may focus on the reopening of borders in April and the declining Covid-19 cases on the local front; these could provide potential trading opportunities within the recovery themed stocks. On the commodity market, the crude oil price rebounded above USD110 per barrel mark, while the CPO traded below RM6,000.

Sector focus: Market-sensitive technology stocks may fell along with Nasdaq’s overnight pullback after the rally last 2 weeks. Meanwhile, the energy sector should see some rebound in tandem with the elevated crude oil price. Also, traders may put attention on aviation, tourism and consumer sectors as Malaysia will reopen the travel borders on 1st April 2022.

FBMKLCI Technical Outlook

The FBM KLCI finished flat as the key index continued hovering below its daily EMA20 level. Technical indicators are mixed as the Histogram has been declining, while the RSI is hovering above 50. Next support is pegged around 1,550-1,560, while resistance is set at 1,600.

Company Brief

The external auditor of MLABS Systems Bhd, Messrs PKF has resigned due to disagreement in fixing audit fees. PKF had given their resignation notice in writing on 30th March 2022 pursuant to Section 281(1) of the Companies Act 2016. Pursuant to the Act, PKF's term of office as auditors Mlabs shall end after 21 days from the date of the notice. (The Star)

Pharmaniaga Bhd wholly-owned subsidiary, Pharmaniaga Manufacturing Bhd (PMB) has teamed up with PRIME Healthcare Group, one of UAE’s leading healthcare service providers to expand its presence in the international market, especially in the Middle East. The MoU will serve as the foundation in establishing the framework that will grant Prime Medical the exclusive right to register, import, promote, market, sell and distribute PMB’s pharmaceutical products in the UAE. (The Star)

Damansara Holdings Bhd has secured contracts worth a total of RM28.3m to operate and maintain identified facilities at Pengerang Integrated Complex (PIC) in Johor. Damansara Holdings 70.0%-owned subsidiary, TMR LC Services Sdn Bhd was issued with letters of award from Petronas Refinery and Petrochemical Corp and PRPC Utilities and Facilities Sdn Bhd. The contracts are for a period of 19 months, starting 31st March 2022 to 30th September 2023. (The Star)

Konsortium Transnasional Bhd (KTB) has secured a second construction contract from Probil Industries (M) Sdn Bhd, worth RM139.9m this time. Previously, KTB won a contraction contract from Probil worth RM98.1m on 28th February 2022. The contract is for the supply of all plant, materials, tools, equipment, temporary works, labour and supervision necessary for the construction and completion of the job over 36 months. (The Edge)

T7 Global Bhd has secured a contract from Petronas for the provision of third-party professional and support services. The contract spans a duration of 3 years from 15th December 2021 to 14th December 2024 and carries risk factors which include, among others, inadequate competent resources and non-compliance with statutory and regulatory requirements. (The Edge)

PMB Technology Bhd has entered into a Memorandum of Understanding with Sabah Oil & Gas Development Corp Sdn Bhd (SOGDC) for the potential sublease or sale of 200.0-ac of land at the Sipitang Oil and Gas Industrial Park (SOGIP) in Sabah and development of a new silicon metal production plant. SOGDC, which is a company owned by the Sabah government owns and manages SOGIP, which is in the process of being developed into an industrial park dedicated for oil and gas activities. (The Edge)

Source: Mplus Research - 31 Mar 2022