Previous Day Highlights

The FBM KLCI continued to trend lower and ended at intraday low, dragged down by selling pressure from consumer products and services counters. The benchmark index declined 0.19% or 2.59 points to close at 1,389.90. Losers were led by NESTLE, PETDAG and QL. However, market breadth was positive with 438 gainers against 378 losers while 440 remain unchanged. Total volume stood at 2.54bn shares valued at RM1.52bn.

Major regional indices slipped into the red as China's services activity softened, reigniting weak recovery in China concerns. Nikkei 225 and STI lost 0.25% and 0.57% respectively, to close at 33,338.70 and 3,185.38. Meanwhile, HSI tumbled 1.57% to end at 19,110.38 while SHCOMP fell 0.69% to close at 3,222.95.

Wall Street closed on a weak note as investors digested US Federal Reserve's rate hike policy moving forward. The DJI dropped 0.38% to close at 34,288.64 while S&P500 and Nasdaq lost 0.20% and 0.18% to end at 4,446.82 and 13,791.65.

News For The Day

Proton posts best sales since 2012 in 1HFY23

Proton Holding posted its best cumulative sales numbers since 2012 in the 1HFY23, with total sales reaching 77,321 units. The company said it sold 14,351 units in June (domestic and export), a 28.6% YoY increase. Proton said that for June, total industry volume (TIV) is estimated to be 61,900 units and as a result, market share for the carmaker is estimated at 23.2% while the YTD market share figure has increased again to 21.3%, an improvement of 3.2% YoY. -The Edge Markets

Scientex to acquire 960-acre land in Johor Bahru

Scientex has proposed to acquire 960 acres of freehold land in Mukim Tebrau, Johor Bahru for RM547.7m, further expanding its presence in affordable housing townships across the state. Its subsidiary Scientex Lestari SB had entered into a sale and purchase agreement (SPA) with the land vendor Pelangi SB, a subsidiary of SP Setia.-The Star

LBS Bina signs JV agreement for RM1bn mixed development

LBS Bina Group’s wholly owned subsidiary, Sejuta Bina SB has signed a joint venture agreement (JVA) with Saga Tunas SB to jointly develop six pieces of freehold vacant Malay Reserved Land. LBS said the land measuring 6.97 acres (304,408sqft) held under six individual titles all in Mukim Kuala Lumpur, Tempat Sungai Penchala, Daerah Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur. The proposed development, planned to be commenced within 12 months from the JVA become unconditional. -The Edge Markets

KPS Consortium’s major shareholder takes up substantial

stake in BTM Resources Koh Poh Seng, who controls 46.13% in KPS Consortium, has emerged as a substantial shareholder of BTM Resources, a day after it was announced that Bioalpha Holdings' founder William Hon Tian Kok has taken up a substantial stake in the company. Koh bought 137.78m shares or 10.97% stake in the loss-making timber company. -The Edge Markets

GUH Holdings expects RM4m revenue boost

GUH Holdings said the out-of-court settlement with a unit of JAKS Resources and a construction firm over its payment claim for work undertaken as a sub-contractor is expected to result in revenue increment of some RM4m for FY23. The company said: “The envisaged settlement amount of RM9.07m receivable by Teknoserv Engineering SB is expected to have a positive impact on the financial and/or operational of the Company”. -The Edge Markets

Our Thoughts

Wall Street resumed trading on a weak note as minutes on June from the Feds indicated that there will be more rate hikes ahead. This is despite recent data showing a weaker than expected factory order in May. The DJI Average lost 130 points while the Nasdaq declined by 25 points as the US 10-year yield inched closer to the 4% level at 3.934%. Over in Hong Kong, the HSI tumbled 305 points following a downgrade on several major banks by Goldman Sachs. Sentiment deteriorated further as the ongoing US/China spat within the tech sector may hinder the development of the industry. Back home, the FBM KLCI closed lower as selling intensified towards the closing. It is interesting to note that the Plantation stocks are quietly sustaining its uptrend to a 1-month high reflecting the recent rebound in CPO prices currently above the RM3,900/tonne mark or a 3-month high. Although the date for the state polls set on August 12 may alleviate some degree of uncertainties to the market, we reckon sentiment will remain cautious thus expect the index to trend within the 1,385-1,405 range today.

Source: Rakuten Research - 6 Jul 2023

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