Window Dressing Activities To Persist

Market Review

Malaysia: The FBMKLCI (+0.67%) continued its bullish tone for the third consecutive day and closed higher at 1613.70 pts, with all the sectors ended positively as well. The Industrial Products & Services (+1.74%) saw the largest gain, which was mainly driven by PCHEM and PMETAL.

Global markets: The US market ended mixed on Thursday, with the Dow traded flat while both S&P500 and NASDAQ closed lower. Similarly, the Asian market also ended mixed, with several markets including Hong Kong remained closed on Boxing Day, while Nikkei225 rose as government reportedly set to propose record budget.

The Day Ahead

The local bourse continued to trade higher, as buying interest was seen across the blue-chip stocks, lifting the KLCI index. In the US, Wall Street closed mixed in thin trade following the Christmas holiday. The weekly US jobless claims data released yesterday came out at 219k, lower than most of the economists' expectation of 224k, signalling stronger employment market. Meanwhile, traders will also continue to keep track on the crude oil inventories later today. In the commodities market, Brent crude oil ended slightly lower at USD73.26 per barrel. Gold prices traded flat around USD2,630, while CPO prices continued to stay above the RM4,500 mark.

Sector Focus: With the proposed electricity tariff hike by TNB starting July next year, traders may find trading opportunities in the Utilities sector. On top of that, as TNB was being shortlisted to develop a 500MW solar plant in Kedah under the LSS5 programme, along with the government's recent removal of the 85% demand cap under the self-consumption (SelCo) programme, it presents further upside opportunities in the solar-related counters. Finally, improved employment data in the US, which might lead to Fed to remain its hawkish tone, is likely to benefit the local Technology stocks.

FBMKLCI Technical Outlook

The FBMKLCI showed some recovery signals by breaking above the EMA20. The MACD Histogram has turned positive, while the RSI has crossed above 50, suggesting that the momentum is fairly positive. Resistance is anticipated around 1,628-1,633, and support is set at 1,593-1,598.

Company Briefs

Tenaga Nasional Bhd (TENAGA) announced that Peninsular Malaysia's base electricity tariff will increase to 45.62 sen per kilowatt hour (kWh) for the regulatory period 2025-2027 (RP4), effective July 1, 2025. The current rate of 39.95 sen per kwh will remain unchanged for the first half of 2025, with any cost difference covered by Kumpulan Wang Industri Elektrik (KWIE). (The Edge)

The utility giant also said that its unit, TNB Renewables Sdn Bhd (TRe), has been shortlisted to develop a 500MW large-scale solar photovoltaic (PV) plant in Kuala Muda, Kedah, making it Malaysia's largest LSS project to date. According to sources, other LSS5 winners include Samaiden Group Bhd (SAMAIDEN), Aizo Group Bhd (AIZO) and Gadang Holdings Bhd (GADANG). (The Edge)

Bird's nest processor MyMBN Bhd (MBN) said that Malaysia's government has temporarily suspended bird's nest exports to China due to the Newcastle disease. The suspension, effective Wednesday, impacts the entire industry for both cleaned and uncleaned bird's nest products. MyMBN is shifting its sales focus to Vietnam and the local market to mitigate potential financial impacts. (The Edge)

The Employees Provident Fund (EPF) has once again ceased to be a substantial shareholder in YTL Power International Bhd (YTLPOWR) after selling 14.93m shares on December 20. The transaction was valued at an estimated RM61.79m, based on the multi-utility owner and operator's closing price of RM4.14 per share. (The Edge)

Kawan Renergy Bhd's (KENERGY) co-founder and managing director, Lim Thou Lai, has reduced his stake in the company to 67.03% after selling 19.24m shares or a 3.5% stake for RM12.31m, or 64 sen apiece. The sale was priced at a 10.49% discount to the closing price of 71.5 sen and a 113.33% premium to the IPO price of 30 sen. Lim remains the sole substantial shareholder with 368.66m shares. (The Edge)

Builder Taghill Holdings Bhd (TAGHILL) said that its unit, Siab (M) Sdn Bhd, has received a RM2.59m adjudication claim from subcontractor Landasan Angkasa Sdn Bhd over a completed warehouse project. The claim disputes Siab (M)'s defence of set-off against liquidated ascertained damages. (The Edge)

Boustead Heavy Industries Corp Bhd (BHIC) has appointed former Royal Malaysian Air Force (RMAF) chief Tan Sri Roslan Saad as its independent non-executive chairman, filling a position vacant since former navy chief Tan Sri Ramlan Mohamed Ali resigned in June 2021. Roslan previously served as RMAF chief until 2016. (The Edge)

Sabah-based oil palm and cocoa planter Teck Guan Perdana Bhd (TECGUAN) said net profit in its third quarter ended Oct 31, 2024 (3QFY2025) fell 34.3% to RM2.39m from RM3.64m a year ago, on lower revenue and a net loss on forward currency contracts amounting to RM4.33m. Revenue dropped by a quarter to RM68.37m from RM91.25m in 3QFY2024 due to lower sales volume. The group did not announce any dividend for the quarter. (The Edge)

CCK Consolidated Holdings Bhd (CCK) has declared a five sen per share special dividend for FY2024, its highest in 11 years, amounting to RM31.05m. The dividend will be paid on Jan 22, 2025. (The Edge)

Construction outfit Lebtech Bhd (LEBTECH) has been appointed by Affizal Resources to collaborate on water works in Selangor valued at RM10.8m through its subsidiary. The project begins in 1Q2025 and is expected to boost its earnings for FY2025. (The Edge)

Southern Cable Group Bhd (SCGBHD) has secured a RM172.57m contract from an undisclosed client in East Malaysia to supply cables and conductors. The contract, awarded to its wholly-owned subsidiary Southern Cable Sdn Bhd, spans from Dec 20, 2024, to Dec 19, 2026. This latest win boosts its outstanding order book to RM871.87m. (The Edge)

Source: PublicInvest Research - 27 Dec 2024