Marginally lower 

Market Review

Malaysia:. The FBM KLCI (-0.1%) edged lower for the third straight session, dragged by weakness in Petronas-related heavyweights. The lower liners also closed mildly lower, while the broader market ended mixed with the plantation sector (+0.6%) outperformed.

Global markets:. Wall Street was closed for Labour Day public holiday. The European stock markets ended mostly lower after Russia’s state-owned energy giant Gazprom announced that gas flows to Europe would be halted indefinitely, citing additional repair requirements, while Asia stock markets closed mixed.

The Day Ahead

The FBM KLCI closed marginally lower, taking cue from the mixed regional markets amid anxiety over energy crisis in Europe as well as ongoing China’s lockdown to curb Covid-19 spread under the “zero-Covid” policy. Moving forward, we opine that the global markets should stay in a consolidation mode, at least until the next CPI data, while the local bourse may turn their focus to the energy sector as OPEC decided to trim production for October 2022, which has driven the Brent oil price slightly above USD95 per barrel. Meanwhile, the CPO price remained below RM4,000.

Sector focus:. We believe investors may continue to avoid technology stocks amid ongoing fears on interest rate hikes ahead of the US CPI data next week. Investors may turn their focus to energy sector in anticipation of a tighter oil market moving forward following OPEC’s decision to cut production. Meanwhile, we remained positive on the banking sector ahead of BNM’s interest rate decision.

FBMKLCI Technical Outlook

The FBM KLCI remained below the 1,500 level for the third straight session. Technical indicators turned negative as the MACD Histogram falls below zero, while the RSI stayed below 50. The resistance is pegged along 1,510-1,530, while the support is located at 1,480, followed by 1,465.

Company Brief

EP Manufacturing Bhd (EPMB) has secured approval from the Malaysian government to register and license its first-ever two-wheel electric vehicles (EVs). The national committee for vehicle type approval (VTA) and homologation, Road Transport Department (JPJ) had approved the VTA for Blueshark SG3000DT model, or Blueshark R1 under the Malaysia Road Transport Act 1987. (The Star)

Pekat Group Bhd’s wholly owned subsidiary, Solaroo RE Sdn Bhd (SRSB), has obtained a moneylender license issued under the Moneylenders Act 1951 and the Moneylenders (Control and Licensing) Regulations 2003 from the Housing and Local Government Ministry. The license to undertake the business of money lending services in relation to solar leasing and other related services shall be valid for a period of two years effective from 26th August 2022. The license is renewable upon the renewal application is made with the ministry. (The Star)

Kelington Group Bhd’s wholly owned subsidiary, Kelington Technologies Sdn Bhd has secured a RM330.0m contract from the world leader in semiconductor solutions to undertake the bulk and specialty gas system distribution works in Kulim. Works shall commence in September 2022 and are expected to be completed by September 2024. (The Star)

Bank Negara Malaysia has accepted Sapura Energy Bhd’s application for assistance to mediate debt restructuring with its multicurrency facilities (MCF) financiers. The Corporate Debt Restructuring Committee of Malaysia, a committee under the purview of BNM, has given it 60 days from 1st September 2022 to submit a proposal for debt restructuring. (The Edge)

The Malaysian Competition Commission (MyCC) has granted Leong Hup International Bhd’s wholly-owned subsidiary Leong Hup Feedmill Malaysia Sdn Bhd (LFM) a one-month extension to 21st October 2022 to submit its written representation in response to MyCC’s poultry feed price-fixing proposed decision. At this juncture, the RM157.5m financial penalty, as well as other directions potentially imposed on LFM under the proposed decision are not final. (The Edge)

KPJ Healthcare Bhd president and managing director Datuk Mohd Shukrie Mohd Salleh is stepping down from the positions effective 7th September 2022 to pursue other opportunities, just 5 months after assuming the role on 1st April 2022. In the interim, KPJ Healthcare chief financial officer Norhaizam Mohammad will fill the void left by Mohd Shurkrie and assume the role of officer in charge. (The Edge)

Inta Bina Group Bhd’s wholly-owned subsidiary Inta Bina Sdn Bhd has accepted a letter of award worth RM146.0m from Eco Ardence Sdn Bhd to design and build main building works in relation to a mixed-use development project located in Shah Alam, Selangor. The development will see a 32-storey serviced apartment block with 500 units, as well as an eight-storey covered parking podium block with facilities on the ground floor. (The Edge)

Majuperak Holdings Bhd group CEO cum executive officer Nizran Noordin has been told to go on garden leave starting 2nd September 2022, about two months ahead of the expiry of his service contract on 31st October 2022. In his absence, chief financial officer Syed Agil Syed Hisham, who was only appointed on 29th August 2022, is appointed as the acting group CEO, to assume the day-to-day management of the group. (The Edge)

Microlink Solutions Bhd has appointed Ramlee Abdullah as its new group CEO to replace Chia Yong Wei, who is stepping down from the role after 6 years at the helm. Ramlee came over to the company from Omesti Group in March 2022 as senior manager of sales, before being subsequently redesignated as the CEO of the public sector on 1st June 2022. (The Edge)

JAG Bhd’s wholly-owned subsidiary JAG Land Sdn Bhd has entered into a sales and purchase agreement with Menara ABS Bhd to acquire a 12-and-a-half-storey building in Taman Desa, Kuala Lumpur for RM35.29 m, as part of the group’s effort to expand its property investment business. (The Edge)

Capital A Bhd is progressing with plans for the listing of AirAsia Aviation Group Ltd and airasia Super App in New York, according to its CEO Tony Fernandes, who reported that the company would probably make the announcement in 2023. (The Edge)

Solutions Group Bhd has announced that the inhalable version of CanSino Biologics Inc’s Recombinant Covid-19 Vaccine (Adenovirus Type 5 Vector) ― Convidecia Air has received clinical trial approval from the Medical Research and Ethics Committee under the Ministry of Health, marking the first trial study of the inhaled version of Covid-19 vaccine in Malaysia. (The Edge)

South Malaysia Industries Bhd (SMI) has been slapped with an unusual market activity query by Bursa Malaysia Securities Bhd, after a sharp fall in its share price. In reply to the bourse regulator’s query, the property development company said its board is unaware of any corporate development relating to its business and affairs that have not been previously announced. (The Edge)

Destini Bhd has denied that it has been classified as a Practice Note 17 company and that it was set to be de-listed. It added that any such announcement would have been announced in accordance with Bursa’s Main Listing Requirements. (The Edge)

Public Bank Bhd and Sunway Integrated Properties Sdn Bhd have signed a memorandum of understanding to collaborate on sustainable development projects which enable customers who purchase green-certified properties developed by Sunway Property to be entitled to Public Bank’s Special Sustainable Financing Package. (The Edge)

KPower Bhd has changed its name to Reneuco Bhd and notes that the company’s securities will be traded and quoted under the new stock short name of RENEUCO, with effect from 6th September 2022. (The Edge)

Source: Mplus Research - 6 Sept 2022