Market Review

Malaysia:. The FBM KLCI (+0.4%) rebounded along with the regional bourses, snapping its three-session losing streak following a positive cue from Wall Street overnight. Meanwhile, the lower liners ended higher, while the buying momentum remained strong in the healthcare sector (+1.9%).

Global markets:. The US stockmarkets declined, led by the technology-heavy Nasdaq as concerns over central bank’s hawkishness persisted on the back of strong labour market and decent economic growth in the US. The European stockmarkets ended mostly lower, while Asia stockmarkets closed mixed.

The Day Ahead

The FBM KLCI recovered from three-session losses amid improved sentiment on Wall Street. However, we believe the global sentiment may remain weak as selling pressure returned on Wall Street with the recession worries returned in the expectation of further monetary tightening from global central banks. Meanwhile, investors might be eyeing the quarantine cutting measure for overseas travellers from next month in China, but having cautious tone given the Covid-19 pandemic is still not resolved. Nevertheless, we expect the downside risk shall be cushioned by the return of foreign funds. Commodities wise, both the Brent crude oil and CPO prices declined, hovering around USD80 and RM3,850 respectively.

Sector focus:. For the Covid-19 situation in China, we expect traders focus in glove companies. Meanwhile, YINSON’s decent result could spur interest within the O&G sector. In contrast, the technology sector may face mild selldown following a retreat on Wall Street Nasdaq.

FBMKLCI Technical Outlook

The FBM KLCI rebounded and closed above its immediate support at 1,460 despite a lacklustre trading. Technical indicators remained mixed as the MACD Histogram extended a negative bar, while the RSI is hovering above 50. Resistance is envisaged along 1,500-1,510, while the support is identified at 1,450-1,460.

Company Brief

GDB Holdings Bhd has secured a RM247.0m design-and-build contract to construct a logistic hub in Kapar in Klang, Selangor. Its unit Grand Dynamic Builders Sdn Bhd had accepted a Letter of Award from SDPLOG 1 (Industrial Asset I) Sdn Bhd, a wholly owned subsidiary of SDPLOG 1 (MY Holdings) Sdn Bhd and established under the Sime Darby Property - LOGOS Property Industrial Development Fund 1 LP. (The Star)

Serba Dinamik Holdings Bhd is poised to see its shares suspended from trading on Friday (23rd December 2022) due to its failure to submit its annual report for the financial year ended 30th June 2022. The issuance of the annual report has been delayed as the board of directors are still working on resolving the outstanding audit fees issue with the external auditors. (The Star)

Yinson Holdings Bhd's 3QFY23 net profit rose 58.2% YoY to RM155.0m, mainly due to higher contribution from its engineering, procurement, construction, installation and commissioning business activities and FPSO operations. Revenue jumped 11.8% YoY to RM1.73 bn. (The Star)

Mynews Holdings Bhd’s 4QFY22 net profit stood at RM1.4m, vs. a net loss of RM9.0m in the previous corresponding quarter, mainly contributed by an improvement in sales mix and higher margin of the CU convenience store business. Revenue increased 84.5% YoY to RM180.6m, thanks to new outlets, longer business hours as well as an improvement in the overall in-store sales. (The Edge)

Gamuda Bhd via Gamuda Australia has bagged a major road transport project from the New South Wales government worth A$1.03 bn (RM3.03 bn). A 60:40 joint venture of John Holland and Gamuda Australia was awarded the contract to deliver the Black Hill to Tomago Package of Works for the M1 Motorway Extension to Raymond Terrace. The group expects revenue of RM1.21 bn from the project. (The Edge)

Tenaga Nasional Bhd’s (TNB) wholly-owned subsidiary TNB Fuel Services Sdn Bhd has inked a Memorandum of Understanding with MNA Fuel Services Sdn Bhd, Itochu Malaysia Sdn Bhd and Cement Industries of Malaysia Bhd to conduct studies on alternative fuel sources, generation and chains in the energy transition towards carbon neutrality by 2050. (The Edge)

Apollo Food Holdings Bhd's 2QFY23 net profit jumped 965.3% YoY to RM9.5m on stronger sales and low base effect, after earnings were hit by Covid-19 disruptions in the same quarter last year. Revenue increased 87.0% YoY to RM70.3m. (The Edge)

Yang di-Pertuan Agong Al-Sultan Abdullah Ri'ayatuddin Al-Mustafa Billah Shah has emerged as a substantial shareholder of Microlink Solutions Bhd with a 10.8% indirect equity interest. This is by virtue of his shareholding in Gading Sari Ventures Sdn Bhd, which has acquired 115.0m shares in the customised turnkey software and system solutions provider from Omesti Bhd for RM63.3m, or an average of 55 sen apiece. (The Edge)

Sports Toto Bhd’s 88.26%-owned subsidiary Berjaya Philippines Inc has reduced its shareholdings in Redtone Digital Bhd to realise part of its investments. Berjaya Philippines disposed of 9.6m shares or a 1.2% stake in Redtone Digital for RM4.8m based on the agreed price of 50 sen a share. (The Edge)

Classita Holdings Bhd (formerly known as Caely Holdings Bhd) has appointed Spring Gallery Bhd's former executive director, Datuk Kuan Poh Huat, as its new executive director. Kuan is currently a director of Skyline Works Sdn Bhd and Paris Dynasty Land Sdn Bhd, both wholly-owned subsidiaries of Harvest Miracle Capital Bhd. (The Edge)

Citaglobal Bhd is exiting its bauxite mining venture under SE Satu Sdn Bhd to focus on a portfolio of businesses that include civil engineering and construction, oil and gas, power generation, property development, manufacturing and renewable energy. It will divest its entire 49.0% stake in SE Satu to Spring Energy Sdn Bhd for RM4.8m. (The Edge)

Mudajaya Group Bhd has decided not to proceed with a small hydro project that it secured approval from the authorities two years ago, after internal feasibility studies showed that it could not meet the group’s “investment threshold”. It had announced in December 2020 that the feed-in approval certificate for the project was secured by its 76%-owned Bera Hydropower Sdn Bhd from the Sustainable Energy Development Authority after Bera Hydropower successfully tendered for the project. (The Edge)

Source: Mplus Research - 23 Dec 2022