Previous Day Highlights

FBM KLCI ended lower amid regional weaknesses. The benchmark index lost 0.27% or 4.01 points to close at 1,454.66 with losers led by NESTLE, PPB and KLK. Market breadth was negative with 536 decliners against 315 advancers while 413 were remain unchanged. Total volume stood at 2.82bn shares valued at RM1.97bn.

Key regional indices closed mostly in negative territory following the negative cue from Wall Street overnight. STI dropped 0.57% to close at 3,226.86 whereas NIKKEI 225 added 0.48% to close at 28,444.19. Meanwhile, HSI slumped 2.35% to finish at 20,051.25 while SHCOMP closed flat at 3,283.25.

Wall Street 3 major indices trended mixed as sentiment turned cautious after the comments from Federal Reserve Chairman Jerome Powell hinting at higher interest rates over a longer period. The DJIA weakened 0.18% to end at 32,798.40, while the S&P500 and Nasdaq advanced 0.14% and 0.40% to finish at 3,992.01 and 11,576.00 respectively.

News For The Day

Magni-Tech’s 3Q profit falls 23%

Magni-Tech Industries’ 3QFY4/23 net profit fell 23.09% YoY to RM20.52m from RM26.68m, due to lower contributions from its garment and packaging segments. Quarterly revenue fell 10% YoY to RM281.83m from RM312.83m on the back of lower segmental contributions. The group proposed a third interim dividend of two sen per share, payable on April 12. -The Edge Markets

KESM invests RM140m for new test equipment

KESM Industries has invested close to RM140m largely for new test equipment as car makers shifted to full gear to expand the electric vehicles market. “Some of these new installations have now been approved for manufacturing and we expect progressive volume growth in the later part of this year as the automotive market remains strong,”. – The Edge Markets

Perodua's year-to-date sales jump 33%

Perusahaan Otomobil Kedua SB’s (Perodua) sales jumped 33% to 46,385 vehicles from 34,865 vehicles for the first two months of the year. YTD, its production jumped 32.95% to 51,134 units from 38,460 units. The carmaker said the increase was due to improved efficiency in terms of production, better financing facilities to Perodua dealers, and greater communications both within the ecosystem as well as with Perodua customers. -The Star

G Capital signs solar PPA with Federal Packages

G Capital's 70%-owned subsidiary, Solarcity Malaysia SB, has signed a supplemental solar power purchase agreement (SPPA) with Federal Packages SB. G Capital noted in the SPPA, Solarcity and Federal Packages agreed to revise the capacity of the facility to 4,500 kwp from 5,500 kwp previously. Solarcity will design, construct, install, own, operate, and maintain a solar photovoltaic energy generating system at the premises of Federal Packages in Penang. The new solar plant is expected to be operational by 2QCY23. -The Star

Pekat Group surrenders moneylending licence

Pekat Group has decided to surrender the moneylender license as the business is no longer feasible due to the change in the group's business strategy. It said Solaroo RE SB (SRSB), a wholly-owned subsidiary of Pekat Teknologi SB, which in turn is a wholly-owned subsidiary of Pekat decided to surrender the license. Pekat said there is no operational and financial impact on the group as SRSB has not commenced its moneylending business since being granted the licence on Aug 26, 2022. -The Star

Our Thoughts

Wall Street ended mixed as concerns over Jerome Powell’s comment of a prolonged high interest rates environment continue to spook traders. As such, the DJI Average declined by 58 points while the Nasdaq rebounded by 46 points as the US 10-year yield inched higher at almost the 4.0% mark. In Hong Kong, the selldown on Hong Kong equities gathered pace on fresh concerns over China’s latest overhaul on regulation over the financial sectors. As a result, the index lost a massive 483 points to end at just above the 20,000 level. On the domestic front, the FBM KLCI maintained its lackluster performance as the index fell 4 points amid a weak regional performance. For today, we reckon the index to remain stuck within a tight range of between 1,450- 1,460. Meanwhile, reports that the RM50-55bn High Speed Rail (HSR) project could be revived provided it is funded by the private sector should inject some excitement into the Construction sector. Amongst others, we believe contractors namely Gamuda, YTL Corp, MRCB and IJM Corp could be the frontrunners for the project.

Source: Rakuten Research - 9 Mar 2023

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