Previous Day Highlights

The FBM KLCI pared its earlier losses and ended positively, driven by broad-based accumulation. The benchmark index gained 0.35% or 4.81 points to close at 1,385.42. Gainers were led by PETDAG, INARI and NESTLE. Market breadth was positive with 504 gainers against 368 losers. Total volume stood at 2.86bn shares valued at RM1.75bn.

Key regional indices closed on a mixed note as market undertone remained uncertain ahead of the FOMC meeting. Nikkei 225 and STI rose 1.47% and 0.90% to close at 33,502.42 and 3,218.14. Meanwhile, HSI and SHCOMP dipped 0.58% and 0.14% to end at 19,408.42 and 3,228.99 respectively. Wall Street closed mixed after the Fed paused interest rate hikes but warned of potential future monetary tightening. The DJIA fell by 0.68% to end at 33,979.33 whereas Nasdaq advanced 0.39% to close at 13,626.48. Meanwhile, S&P 500 closed flat at 4,372.59.

News For The Day

HLIND to exit fibre cement board manufacturing business

Hong Leong Industries (HLIND) has proposed to dispose of its wholly-owned fibre cement products manufacturing subsidiary at an indicative price of RM79.5m. HLI said it will secure a net gain of RM12.9m from the sale of Hume Cemboard Industries SB to Saint-Gobain Malaysia SB at the indicative price. The final sale price will be determined later, adding that the sale is expected to be completed in the 2Q or 3QFY24.- The Edge Markets

UOA Development embarks on F&B business venture

UOA Development has proposed to venture into the food & beverages (F&B) business. UOA said its units Armada Hartasegar SB and Regenta Development SB had entered into a term sheet agreement with Hokkien Peng Restaurant Group SB and Hoteland SB. Armada will provide the set-up cost of the business which amounts to RM21.17m by way of subscription of redeemable preference shares (RPS) in Hoteland at a subscription price of RM1 per RPS.-The Edge Markets

APB Resources hits limit-up as Press Metal co-founder

emerges as new substantial shareholder Shares of APB Resources hit limit-up after Press Metal Aluminium Holdings’ co-founder and executive director Datuk Koon Poh Tat emerged as its new substantial shareholder. Koon bought a 5.72% stake or 6.35m shares on the open market. Based on APB Resources’ closing price of RM2.25, the block of shares would have cost Koon RM14.29m. -The Edge Markets

Ewein gets 60sen/share takeover offer from NationGate MD

Ewein has received a mandatory takeover offer to acquire all the remaining ordinary shares from NationGate Holdings managing director Ooi Eng Leong for a cash offer price 60 sen. Ewein said Ooi had acquired 120.59m shares, or 39.99% stake in Ewein for RM72.35m from Hijauwasa SB. Prior to the acquisition, Ooi held 3.84% stake in the company. The acquisition raised his shareholding to 43.82%.-The Star

K Seng Seng to raise RM41m from private placement to fund

stake buy, working capital K Seng Seng Corp is seeking to raise up to RM41.47m from a private placement to finance the acquisition of a majority stake in a precision machined parts manufacturer, and for working capital. The placement entails the issuance of up to 34.56m new shares, representing not more than 20% of the group's issued shares, to independent investors to be identified later. – The Edge Markets

Our Thoughts

Wall Street ended mixed as the Federal Reserve paused their rate hike campaign but indicated that there will be more to come going forward. As a result, the DJI Average lost 233 points while the Nasdaq gained 53 points as the US 10-year yield declined to 3.79%. Over in Hong Kong, the HSI slipped 180 points as traders were unimpressed with China’s anticipated stimulus to lower short term policy rate today may be a little too late. Meanwhile, sentiment was also affected by the delisting of mainland Chinese developers amid a weak housing market. Nonetheless, recent attempts from the US to ease tension with China may raise hopes to inject confidence back into the financial system. Back home, the FBM KLCI closed higher attributed to late buying activities on selected heavyweights. Today, we expect market sentiment to remain nervy amid heightening regional volatility taking cue from Wall Street. Thus, we reckon the index to remain stuck within the 1,380-1,390 range today and the absence of rate hikes may continue spur buying interests on Tech counters over the short term.

Source: Rakuten Research - 15 Jun 2023

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