Previous Day Highlights

The FBM KLCI ended in negative territory following Bank Negara Malaysia raised OPR by 25bps on Wednesday. The benchmark index lost a mere 0.01% or 0.12 points to close at 1,425.99. Losers were led by NESTLE, PETGAS and HLFG. Market breadth was negative 553 losers against 277 gainers. Total volume stood at 3.48bn shares valued at RM1.58bn.

Key regional indices ended in positive territory despite the US Federal Reserve’s quarter rate hike. STI rose 0.22% to end at 3,269.18 whereas HSI and SHCOMP jumped 1.27% and 0.82% to close at 19,948.73 and 3,350.46 respectively. Meanwhile, Nikkei 225 was close for golden week holiday.

Wall Street continue to trend lower as sentiment remain fragile on regional bank stock and recession concern. The DJIA and S&P500 dipped 0.86% and 0.72% to end at 33,127.74 and 4,061.22, respectively, while the Nasdaq fell by 0.49% to close at 11,966.40.

News For The Day

CelcomDigi withdraws equity participation in DNB

CelcomDigi has pulled out from participating in the equity of Digital Nasional (DNB) after Putrajaya said it will allow the formation of a second 5G network provider in the country as soon as next year. The group said its wholly-owned subsidiaries, Digi Telecommunications SB and Celcom Mobile SB, have terminated their respective agreements to subscribe for a 12.5% stake each in DNB "as the long stop date to fulfil all the conditions precedent has lapsed". -The Edge Markets

MyEG gets three-year extension for online JPJ services

MyEG Services' contract to provide Road Transport Department (JPJ)-related online services has been extended by three years, said Transport Minister Anthony Loke Siew Fook. However, the contract will no longer be exclusive, which means other service providers could also potentially offer the services, which include road tax and driving licence renewal, and summons settlement. – The Edge Markets

F&N 2Q net profit rises to RM101.18m

Fraser and Neave Holdings’ (F&N) 2QFY9/23 net profit rose to RM101.18m from RM93.87m YoY, driven by better performance in its food and beverages business units. Revenue for the quarter rose by 8.9% YoY to RM1.21bn from RM1.11bn. The board declared an interim single-tier dividend of 27 sen per share, amounting to approximately RM99m to be paid on June 1, 2023. -The Star

Sunway REIT’s 1Q NPI rises 16% to RM138m

Sunway Real Estate Investment Trust's (Sunway REIT) net property income (NPI) for the 1QFY23 rose 16.3% YoY to RM138.31m from RM118.92m driven by its retail segment. Quarterly revenue grew 18.7% YoY to RM182.8m from RM153.97m. -The Edge Markets

Frontken 1Q net profit drops 11%

Frontken Corp’s 1QFY/23 net profit fell 11% YoY to RM23.58m from RM26.52m previously as its subsidiaries in Taiwan and Singapore recorded a slightly lower revenue. The group said revenue for the quarter dipped to RM113.99m from RM119.15m YoY. -The Star

Astino to buy land for RM60m

Astino’s wholly- owned subsidiary, Astino (M) Colour Steel Sheets SB, has agreed to acquire a plot of freehold land in Kapar, Selangor, for RM60.16m from Bukit Saujana Jaya SB. The purchase will be funded with money from internally generated funds (15%) and bank borrowings (85%). - The Star

Our Thoughts

Wall Street closed lower for fourth consecutive day on renewed banking fears. The Dow fell by 286 points while Nasdaq shed 0.49%. Over in Hong Kong, stocks ended higher as investors cheered the prospect of an imminent pause to interest-rate hikes. On the domestic front, the FBM KLCI closed in negative territory as Bank Negara Malaysia (BNM) unexpectedly raised the overnight policy rate (OPR) by 25 basis points (bps) to 3%. We believe the local market to see some headwinds particularly banking and property stocks following BNM's monetary tightening measure although bargain hunting activities may emerge as well. Hence, we anticipate the benchmark index to trend sideways within the range of 1,420-1,430 for today.

Source: Rakuten Research - 5 May 2023

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