Recovery in store

Market Review

Malaysia:. The FBM KLCI (+0.2%) halted an 8-day losing streak as bargain hunting activities took place in the second half of the trading session yesterday. The lower liners, however, stayed downbeat, while the broader market ended mostly negative with the healthcare sector (-1.4%) underperformed.

Global markets:. Wall Street staged a sharp rebound as the Dow (+2.7%) rallied as indicators on the aggressive rate hikes subsides after the ISM Manufacturing PMI fell to 50.9 in September of 2022; the weakest since May 2020. The European stock markets extended their gains, but the Asia stock markets closed mixed.

The Day Ahead

Following a heavy selldown in the past week due to continuous outflow of foreign funds, the FBM KLCI bounced higher. Given the strong rebound on Wall Street overnight, we believe the regional markets and local bourse should trade on a higher note. Nevertheless, the rebound may sit on a shaky ground due to lingering global recession fears and lack of fresh positive catalysts; investors may take the opportunity to sell into strength. Commodities wise, the crude oil price signalled a comeback to trade above USD88 per barrel, while the CPO price hovered around RM3,480.

Sector focus:. We believe investors will focus on the tabling of Budget 2023 which is scheduled on 7th October 2022 moving forward. Sectors such as solar related, construction, and telecommunication may see some buying interest. Meanwhile, the rising crude oil may lift the energy counters over the near term. Also, with the rebound in Nasdaq, the technology stocks should be on the radar.

FBMKLCI Technical Outlook

The FBM KLCI rebounded from its 8-day losing streak. Technical indicators, however, might be suggesting that the FBM KLCI is due for a rebound as the MACD Histogram is curving upwards (in the negative region), while the RSI is oversold. The resistance is envisaged along 1,410-1,430, while support is set at 1,365-1,370.

Company Brief

EP Manufacturing Bhd's (EPMB) wholly-owned subsidiary, EP Blueshark Sdn Bhd (EP Blueshark), has received a manufacturing licence from the International Trade and Industry Ministry (MITI) to undertake the assembly of electric bikes. The automotive parts maker is now fully authorised to assemble and manufacture two wheeled electric vehicles (EVs) at its upcoming manufacturing facility in Glenmarie, Shah Alam. (The Star)

Sarawak Cable Bhd (SCB) has been admitted into Practice Note (PN) 17 status by Bursa Malaysia on 3rd October 2022 due to a disclaimer of opinion expressed by its external auditor recently on the cable and wire producer’s audited financial statements for the 17-month period ended 31st May 2022. As at the date of this announcement, the company is taking the necessary steps to address its PN17 status. (The Star)

Ageson Bhd's indirect wholly owned subsidiary Ageson Net Sdn Bhd has been appointed by Koperasi Belia Nasional Bhd (Kobena) to manage the business operations of Kobena's 4,000 units of vending machines and retail refrigerators that are integrated with the Internet-of-Things system and solutions. The latest memorandum of understanding followed an earlier one signed on 30th September 2022 between Ageson Retails Sdn Bhd, another indirect wholly owned subsidiary of Ageson, and Kobena to sell the 4,000 units of vending machines and/or retail fridges. (The Edge)

HCK Capital Group Bhd confirms that it will take over the incomplete property development project known as Empire Remix 1 in Subang Jaya. This is the second abandoned project that the company has taken over there. (The Edge)

Caely Holdings Bhd has clarified that the police did not arrest anyone when carrying out investigations into the troubled lingerie maker's premises on 14th September 2022. Caely also clarified that there was no withdrawal of the lawsuit filed to seek the return of RM30.6m allegedly misappropriated by the group's founder, Datin Fong Nyok Yoon, and her husband, Datuk Chuah Chin Lai. (The Edge)

The concessionaire of the proposed Petaling Jaya Dispersal Link (PJD Link Expressway) is seeking a listing on Bursa Malaysia via the reverse takeover of Practice Note 17 (PN17) company Scomi Energy Services Bhd. The parties are expected to enter into a definitive agreement within 60 days. (The Edge)

TSR Capital Bhd has proposed to dispose of a piece of land measuring 22,134-sqm in Port Dickson with a building erected on it for RM23.8m. The 11-year-old property, with 75,000 sqf of floor area, is currently tenanted for the business of a supermarket-cum-department store, with a rental income of RM99,825/m. (The Edge)

Heng Huat Resources Group Bhd has appointed Fong Chee Khuen, formerly Landmarks Bhd's group chief operating officer and group chief financial officer, as its new chief executive officer, effective 3rd October 2022. (The Edge)

Tiong Nam Logistics Holdings Bhd has promoted its COO Ong Wei Kuan to deputy managing director of the company from 3rd October 2022. Apart from that, the logistic service provider has also promoted Wei Kuan's sister, Christina Ong Chu Voon, to COO. (The Edge)

Jiankun International Bhd, which is in the midst of completing a sizeable private placement of new shares, has redesignated its executive director Datuk Saiful Nizam Mohd Yusoff as the group's deputy executive chairman, effective 3rd October 2022. Saiful Nizam, the son-in-law of former deputy prime minister Datuk Seri Dr Ahmad Zahid Hamidi, currently holds 21.0m shares or a 8.6% stake in Jiankun. (The Edge)

Source: Mplus Research - 4 Oct 2022