Relief rebound

Market Review

Malaysia:. The FBM KLCI (+0.4%) snapped a 6-day losing streak on the back of bargain hunting activities in Petronas-related heavyweights. The lower liners, however, closed mixed, while the energy sector (+1.1%) continued to top the mixed sectorial peers.

Global markets:. Wall Street advanced as the Dow climbed 1.1% on Atlanta Federal Reserve President Raphael Bostic remarks to back a quarter point rate hike this month, while jobless claims fell for the fourth straight week. The European stockmarkets also turned upbeat, but Asia stockmarkets ended mostly negative.

The Day Ahead

The FBM KLCI shook off early losses and rebounded from the 1,450 immediate support level, as bargain hunting activities kicked in. Given the Wall Street accelerated into the green territory overnight as one of the Federal Reserve official’s remarks were more dovish on interest rate direction, we believe the relief rally could spill over to the local bourse. Nevertheless, we believe the upside of the market may be limited until the conclusion of the FOMC meeting this month. Commodities wise, the Brent crude oil traded above USD84, while the CPO price hovered above RM4,290.

Sector focus:. The energy sector may remain in focus given the firmer crude oil price. Besides, the banking, consumer, utilities and telecommunication sectors may be in pace for further acceleration amid global uncertainties.

FBMKLCI Technical Outlook

The FBM KLCI closed above the 1,450 support level, snapping a six-day losing streak. Technical indicators, however, remained negative as the MACD Histogram extended a negative bar, while the RSI is hovering below 50. Support is located along 1,430-1,450, while the resistance is pegged around 1,500-1,510.

Company Brief

Lembaga Tabung Angkatan Tentera (LTAT) has issued a notice of conditional voluntary takeover offer to Boustead Holdings Bhd for the 40.6% stake or 822.5m shares it does not already own in the company at 85.5 sen per share. The offer is conditional upon the Minister of Finance's approval upon Bank Negara's recommendation and approval under Section 87 of the Financial Services Act 2013 and Section 99 of the Islamic Financial Services Act 2013 to allow it to acquire up to 100.0% equity interest in Boustead. The offer is also conditional upon a waiver from Bank Negara from complying with Section 110 of the FSA and Section 122 of the IFSA in relation to the requirement for LTAT and/or its nominated company to be approved as a financial holding company of Affin Bank Bhd and other relevant licensed entities. LTAT does not intend to maintain the listing status of Boustead. (The Star)

Sarawak Consolidated Industries Bhd's wholly-owned subsidiary SCIB Industralised Building System Sdn Bhd has secured an engineering, procurement, construction, and commissioning (EPCC) contract from the Sarawak Public Works Department valued at RM20.7m. The project comes under the third phase of the Sarawak government's RM1.00bn allocation for dilapidated schools involves rebuilding Sekolah Daif in Tebedu, Serian with a duration of 24 months. (The Star)

Sime Darby Bhd is acquiring Australia’s Onsite Rental Group Limited (Onsite) for RM1.92bn. The conglomerate’s unit Sime Darby Allied Operations Pty Ltd is buying Onsite, which provides business to business equipment rental solutions to blue chip customers across a range of industries in the Australian market including resources, energy, industrial and commercial. (The Edge)

Heng Huat Resources Bhd executive director Ng Chin Nam has emerged as a substantial shareholder in the group following the acquisition of a 6.1% stake. He bought the stake, comprising 37.1m shares, via Polargas Sdn Bhd. Ng now becomes the third largest shareholder in the group, after GH Consortium (27.9% stake) and CFamilie Hold Sdn Bhd (20.2% stake). (The Edge)

Telekom Malaysia Bhd expects its contracts with access seekers riding on its network to be finalised by 1H23, after the new Mandatory Standard on Access Pricing (MSAP) came into force on 1st March 2023. (The Edge)

After serving as executive director of Dagang NeXchange Bhd for over two years, Zainal ‘Abidin Abd Jalil has resigned from the post effective 2nd March 2023, due to personal commitment. (The Edge)

Classita Holdings Bhd's substantial shareholder Datuk Seri Tee Yam @ Koo Tee Yam and former chief financial officer Ting Yi En have lodged police reports against the group’s executive director Francis Leong Seng Wui and his lawyers for alleged witness intimidation. These reports alleged that Leong, together with Classita lawyers Wilson Lim Mao Shen and Huam Wan Ying, had intimidated Ting to amend the ex-CFO's affidavit in a civil suit. The civil suit was filed by Koo and former executive vice-chairman Jessie Wong Siaw Puie against Classita, seeking to claim RM4.0m that the duo had advanced to the group to fund day-to-day operations when its accounts were frozen by the Malaysian Anti-Corruption Commission. (The Edge)

Source: Mplus Research - 3 Mar 2023