Gaining ground

Market Review

Malaysia:. The FBM KLCI marched higher, driven by upward move in selected banking heavyweights as the key index registered +1.1% WoW gains. The lower liners, however, stayed downbeat, while the financial services sector (+0.8%) outperformed following the surprise interest rate hike move by Bank Negara last wednesday.

Global markets:. Wall Street rebounded from a 4-day slump as the Dow (+1.7%) rose on the back of strong jobs data, coupled with strong corporate earnings from Apple Inc, offsetting the concern over an economic fallout. The European stockmarkets also turned upbeat, but Asia stockmarkets ended mixed.

The Day Ahead

The FBM KLCI closed higher on Friday despite the mixed sentiment on regional markets. We reckon that the huge and widespread rebounds on Wall Street last week could boost investors’ confidence in both the regional and local bourses. Meanwhile, some key economic indicators which will be released this week include the US inflation rate, Malaysia’s unemployment rate, and Malaysia’s 1Q23 GDP growth rate. Commodities wise, the Brent crude oil price rallied above USD75, while the CPO price hovered above RM3,600; Gold price pulled back but stayed above USD2,000.

Sector focus:. The significant surge in Wall Street Nasdaq over the weekend may lead to buying momentum in the technology counters. Besides, investors may find buying opportunities in gold related counters given the resilient gold prices. Meanwhile, the electric vehicle sector may be under the limelight as the Prime Minister highlights on Malaysia’s intention to attract more Chinese companies to spur domestic automotive sector in aligned with ESG goals.

FBMKLCI Technical Outlook

The FBM KLCI recouped all its intraday losses and closed higher from its daily EMA20 level. Technical indicators turned positive as the MACD Histogram turned into a positive bar, while the RSI hovered above 50. Resistance is pegged along 1,440-1,450, while the support is set around 1,400-1,410.

Company Brief

Westports Holdings Bhd’s 1QFY23 net profit rose 20.9% YoY to RM183.6m, driven by the absence of the Prosperity Tax in the quarter under review. Revenue for the quarter, however, declined marginally by -0.7% YoY to RM512.9m. (The Star)

Bright Packaging Industry Bhd has entered into a new joint venture agreement with Datai Plantations Sdn Bhd (DPSB) for further diversity and increase its investment in oil palm plantation with facilities and provision of services ancillary in land located at Sarikei, Sarawak with an investment of RM5.3m. The agreement was also to supersede the previous joint venture agreement dated 19th August 2021 between both parties. (The Star)

Genting Malaysia Bhd via its wholly-owned subsidiary GenM Capital Bhd has issued medium-term notes (MTNs) of RM500.0m across 3 tranches. The 3 tranches comprise a 5-year note amounting to RM250.0m with a coupon rate of 5.1%, a 7-year note of RM150.0m with a coupon rate of 5.4%, as well as a 10-year tenure of RM100.0m, with a coupon rate of 5.5% per annum, payable semi-annually. (The Edge)

Sapura Energy Bhd has reported that its unit in Labuan, Sapura Drilling Kinabalu Pte Ltd (SDKPL), has been placed under voluntary winding up. The notice for declaration of dissolution pursuant to Section 131A of the Labuan Companies Act 1990 and Labuan Companies (Amendment) Act 2022 was lodged with the Labuan Financial Services Authority on 5th May 2023. The Labuan unit is currently dormant and there are no future plans to activate the company. (The Edge)

SDS Group Bhd will be migrated to the Main Market of Bursa Malaysia under the consumer products & services sector on 8th May 2023. SDS transfer to the Main Market is expected to enhance the group’s prestige and reputation, and will accord it greater recognition and acceptance among investors, in particular institutional investors. (The Edge)

Mohd Amir Masry has ceased to be a shareholder of ACE Market-listed Bahvest Resources Bhd, after offloading his entire 5.4% stake in the gold mining company in off-market trades. Amir’s stake in Bahvest totalling 35.0m shares were held via MAB Ventures Sdn Bhd. MAB sold the shares across 11 blocks on 2nd May 2023 at 30 sen apiece, for a sum of RM10.5m. Seperately, Bahvest’s executive director Lo Teck Yong, who is the son of Bahvest managing director and chief executive officer Datuk Lo Fui Ming, had divested 6.7m shares or a 0.5% stake in Bahvest in the open market on 3rd May 2023. Teck Yong is left with 3.8m shares or a 0.3% stake following the shares divestment. (The Edge)

Digistar Corp Bhd has announced that Lee Kok Choong has ceased to be a substantial shareholder of the company, following his disposal of 10.1m shares in the open market. The shares, held via Star Heritage Development Sdn Bhd, represented a 2.2% stake in Digistar. The 10.1 m shares were sold on 28th April 2023, according to Digistar's bourse filing. With the disposal, Star Heritage is left with 15.6m Digistar shares or a 3.4% stake. (The Edge)

SLP Resources Bhd’s 1QFY23 net profit declined 32.9% YoY to RM3.0m, mainly due to a hike in operating costs since the beginning of 2023 and weakened demand from overseas markets. Revenue for the quarter fell 11.5% YoY to RM40.3m, Nonetheless, A first interim dividend of 1.0 sen per share, payable on 6th July 2023 was declared. (The Edge)

NCT Alliance Bhd’s executive chairman and group managing director Datuk Seri Yap Ngan Choy, and his brother and group executive director Datuk Joe Yap Fook Choy, have trimmed their equity interest in the property developer. The brothers' private vehicle YBG Yap Consolidated Sdn Bhd, disposed of 13.5m shares or a 1.0% stake in NCT for a total sum of nearly RM5.0m. Following the transaction on last Wednesday, Ngan Choy's direct stake in NCT stands at 0.8%, while Fook Choy has a direct stake of 0.5%. (The Edge)

Maju Offshore Sdn Bhd has emerged as a substantial shareholder of Bina Puri Holdings Bhd with a deemed interest of 5.0% in the construction company. Maju Offshore acquired 169.6m shares in Bina Puri on 18th April 2023. Following the shares acquisition, Maju Offshore is now the company’s 4th largest shareholder. (The Edge)

Source: Mplus Research - 8 May 2023