Previous Day Highlights

FBM KLCI closed on a positive note attributed to bargain hunting activities following a six-day sell down. The benchmark index gained 0.36% or 5.29 points to close at 1,455.49. Losers were led by PETDAG, NESTLE and IHH. Overall, market breadth was negative with 504 decliners against 365 advancers. Total volume stood at 2.50bn shares valued at RM1.77bn.

Key regional indices closed broadly lower as Federal Reserve’s rate hike fear weighed on sentiment. Nikkei225 and STI erased 0.06% and 0.62% to close at 27,498.87 and 3,234.90 respectively. Nonetheless, HSI dropped 0.92% to end at 20,429.46 whereas SHCOMP closed flattish at 3,310.65.

The 3 major US Indices ended higher despite the 10-year treasury yield closed above the 4% level. The DJIA climbed 1.05% to end at 33,003.57, while the S&P 500 and Nasdaq increased 0.76% and 0.73% to end at 3,981.35 and 11,462.98 respectively.

News For The Day

LTAT to privatise Boustead at 85.5 sen per share

Lembaga Tabung Angkatan Tentera (LTAT) has issued a notice of conditional voluntary takeover offer to Boustead Holdings for the 40.58% stake or 822.51m shares it does not already own in the company at 85.5 sen per share. The armed forces pension fund, which holds a 59.42% interest in Boustead, said 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% equity interest in Boustead. – The Edge Markets

SCIB bags RM21m contract to rebuild school in Sarawak

Sarawak Consolidated Industries (SCIB) has secured a RM20.65m contract from the Sarawak Public Works Department (JKR) to rebuild a school in Tebedu, Serian. SCIB said the two-year contract, awarded to its wholly owned subsidiary SCIB Industrialised Building System SB, comes under the third phase of the Sarawak government’s RM1bn allocation for dilapidated schools. It is part of a nationwide programme to rebuild or renovate dilapidated schools, especially in rural areas, said SCIB.-The Edge Markets

EPMB returns into profitability in FY22

EP Manufacturing Bhd (EPMB) posted 4QFY22 net profit of RM2.3m, a slight decrease from RM2.74m YoY. Revenue stood at RM186.7m from RM126.61m, the higher revenue recorded was attributed to the reimbursement of tooling costs by customers and increased sales volume as carmakers stepped up deliveries of vehicles booked during the sales tax exemption period. EPMB recorded FY22 net profit of RM0.4m as compared to a net loss of RM8.19m YoY on the back of higher production output, which in turn resulted in improved economies of scale for the company. -NST

Classita's substantial shareholder, former CFO lodge police reports against ED

Classita Holdings'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. The civil suit was filed by Koo and former executive vice-chairman Jessie Wong Siaw Puie against Classita, seeking to claim RM3.96m that the duo had advanced to the group to fund day-to-day operation when its accounts were frozen by the Malaysian Anti-Corruption Commission. - The Edge Markets

Our Thoughts

Wall Street closed firmer from another relief rally due to strong late buying on US equities amid some mixed signals on the economic front as traders are betting on another 25bps hike by the Federal Reserves this month. As a result, the DJI Average gained 342 points while the Nasdaq added 83 points despite the higher US 10-year yield edged at 4.06%. In Hong Kong, following a strong recovery a day before, profit taking activities saw Hong Kong equites closed lower yesterday as the HSI declined by 190 points. Meanwhile, investors are waiting for additional stimulus during the National People’s Congress meeting over the weekend. At home, the FBM KLCI finally closed positively after 6 days of consecutive declines attributed to bargain hunting activities particularly on Plantation and Telco related stocks. As such, the index managed to end above the 1,455 level and we reckon such accumulation to persist thus expect the index to tend between the 1,450-1,460 range today. The just concluded results season saw a rather good performance from corporate Malaysia with no drastic revision on earnings growth is seen at around 10% this year. Earnings from the Banks remained resilient, and we anticipate some buying interests on the Banks today.

Source: Rakuten Research - 3 Mar 2023

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