Previous Day Highlights

The FBM KLCI retreated from its earlier gains to close broadly lower mainly due to late selling pressure in financial services heavyweights. The benchmark index fell by 0.84% or 11.69 points to close at 1,376.68 with losers led by KLK, CDB and MAYBANK. Market breadth was negative with 506 losers against 348 gainers. Total volume stood at 2.65bn shares valued at RM2.03bn.

Key regional indices trended mixed as market sentiment remained cautious, influenced by the weakness shown in China's factory activity. Nikkei 225 and STI slipped 0.14% and 0.04% to close at 33,189.04 and 3,205.91. Meanwhile, HSI erased 0.09% to end at 18,916.43 whereas SHCOMP advanced 0.62% to end at 3,202.06.

Wall Street continued its upward trajectory, led by giant technology stocks. The DJIA rose 0.84% to close at 34,407.60 while S&P500 and Nasdaq surged 1.23% and 1.45% to end at 4,450.38 and 13,787.92 respectively.

News For The Day

Cypark reports net loss after booking RM376m impairments

Cypark Resources fell into the red for the first time since its listing in October 2010, with a net loss of RM298.48m for the February-to-April period this year, no thanks to a hefty RM376m worth of impairments and provisioning. The sum includes a one-off provision for potential liability due to delays in existing projects, and impairments that include outstanding receivables and intangible assets for its waste-to-energy project in Ladang Tanah Merah. -The Edge Markets

M&A Securities completes RTO, listed as M&A Equity

M&A Securities SB has completed its reverse takeover (RTO) of SYF Resources to list on the Main Market of Bursa Malaysia Securities. Concurrent with the RTO exercise, SYF has also changed its name to M&A Equity Holdings (M&A Equity) to better reflect its new core business and future undertakings in the financial services industry. -The Edge Markets

PT Resources posts RM36.47 mil net profit in FY23

PT Resources Holdings’ FY4/23 net profit surged by 72.8% YoY to RM36.47m from RM21.11m. Revenue for the period increased by 43.9% YoY to RM502.61m from RM349.14m, amid improved overall profitability across the group and increased demand as a result of the transition to the Covid-19 endemic phase. The gross profit margin also increased to 14.2%, compared with 10.0% YoY, due to competitive pricing through bulk purchasing. -The Edge Markets

Rimbunan Sawit plans RM223m capital reduction

Rimbunan Sawit has proposed to undertake a capital reduction to cancel RM223.09m of its issued share capital to offset accumulated losses. The loss-making Rimbunan Sawit said the credit of RM223.09m arising from the exercise will be used to set-off against the accumulated losses of the company, while the remaining balance, if any, will be credited to the retained earnings. - The Edge Markets

MN Holdings bags RM13.1m ECRL contract

MN Holdings has secured an underground utilities contract worth RM13.1m for the East Coast Rail Link (ECRL) project. Its wholly-owned subsidiary Mutu Nusantara SB accepted the award from the main contractor, Rentak Segar SB, for its appointment as the sub-contractor for EPCC of the preliminaries and relocation of power cable works at Section 9 in the ECRL project. The EPCC contract will commence immediately and is targeted to be completed in July 2024.-The Star

Our Thoughts

Wall Street maintained its impressive run spearheaded by technology big names. However, sentiment has turned cautious as traders are expecting heightening volatility. The DJI Average gained 285 points while the Nasdaq jumped by 196 points despite the US 10-year yield ended above the 3.8% mark at 3.841%. Meanwhile in Hong Kong, the HSI closed marginally lower as economic activities remained lacklustre as Chinese manufacturing contracted while loan demand fell in the 2nd Quarter. Back home, the FBM KLCI closed broadly lower attributed to the selling on financials. With BNM Monetary Policy Committee set to meet this Wednesday and Thursday. Though we maintain that OPR will not be adjusted this week, sentiment is expected to stay fragile thus we anticipate the index to hover within the 1,370- 1,380 range today. Tech stocks are set to see some buying interests today taking cue from Wall Street.

Source: Rakuten Research - 3 Jul 2023

To sign up for an account: http://bit.ly/40BNqKI

[Youtube Tutorial] Account Opening & Enable Foreign Equity: http://bit.ly/3I5Jzxo