Marginally lower

Market Review

Malaysia:. The FBM KLCI (-0.1%) managed to recover most of its intraday losses, but still closed marginally lower for the session. The lower liners, however, ended mixed, while the broader market closed mostly negative with the energy sector (- 0.5%) pullback from the previous session sharp rally.

Global markets:. US stock markets rallied as the Dow (+2.4%) surged on speculation that markets are near bottom, coupled with the reversal of US Dollar against a basket of currencies. The European stock markets rose in anticipation of European Central Bank rate hike, but Asia stock markets ended mixed.

The Day Ahead

The FBM KLCI booked marginal losses as investors remained on the sidelines while waiting for fresh market leads. Nevertheless, sentiment on the local bourse should improve after mild profit taking activities yesterday, tracking the sharp rally on Wall Street overnight buoyed by strong corporate earnings. Commodity wise, the Brent crude oil price improved, trading above USD107 per barrel mark on the back of resumed worries over tight supply. Meanwhile, the CPO rebounded to trade above RM3,900.

Sector focus:. Following the strong rebound on Wall Street, we expect the technology sector to further rebound amid spillover buying interest on the local tech stocks. Meanwhile, we believe trading interest may emerge in the energy sector amid a strong rebound in crude oil price. Also, consumer, transportation and logistics sector may turn out to be the winner under the recovery theme.

FBMKLCI Technical Outlook

The FBM KLCI closed flat with a hammer pattern. Technical indicators were slightly positive with the MACD Histogram extended another positive bar, while the RSI is recovering above the oversold region towards 50. Resistance is pegged along 1,460-1,480, while the support is set at 1,400-1,420.

Company Brief

Jade Marvel Group Bhd has proposed to diversify its business into mining, sale and trading of iron ore, dolomite, sand and other minerals. The proposed diversification was in line with the group’s objective to expand its revenue stream by diversifying into the new business to enhance shareholders’ value in the long term. The group said it intends to fund the new business through internally generated funds. The proposed diversification is expected to be completed by 3Q2022 and is subject to the approval of its shareholders at an EGM to be convened later. (The Star)

Gadang Holdings Bhd is undertaking subcontract works for a total sum of RM680.0m in the Rapid Transit System Link project connecting Bukit Chagar, Johor Bahru to Woodlands, Singapore. The contract is expected to be completed by 30th June 2024. (The Edge)

Hibiscus Petroleum Bhd is committed to resolving the state sales tax issues with the Sabah authorities in an amicable and collaborative manner, and will ensure minimal disruptions to its operations in the state. (The Edge)

MSM Malaysia Holdings Bhd plans to establish strategic warehouses in East Malaysia with sufficient buffer stockpile as part of food security infrastructure to ensure continuity in sugar availability during any crisis. (The Edge)

MCT Bhd's Alira in Tropicana Metropark, Subang Jaya saw a take-up rate of 30.0% during the launch event last weekend for its Phase 2. Phase 2 of Alira comprises 340 units with a gross development value of RM257.0m. It offers built-ups ranging from 850-1,048 sq ft, with the indicative selling price starting from RM655,800. (The Edge)

Tambun Indah Land Bhd has declared a first and final dividend of 5.9 sen per share for the financial year ended 31st December 2021. The dividend is payable on 12th September 2022. (The Edge)

Cape EMS Bhd is offering up to 259.7m shares in an initial public offering (IPO) as it seeks to list on Bursa Malaysia's Main Market. The group intends to use the proceeds of the IPO for the construction of a new warehouse and installation of automated storage facilities and set-up of a new clean-room facility and purchase of new automated production lines for electronics manufacturing services' operations. (The Edge)

Source: Mplus Research - 20 Jul 2022