Previous Day Highlights

The FBM KLCI ended higher with buying interests mainly on the banking counters. The benchmark gained 0.36% or 5.19 points to close at 1,451.0. Gainers were led by PPB, PETGAS and CIMB. Market breadth was positive with 437 gainers against 389 losers. Total volume stood at 3.17bn shares valued at RM1.71bn.

Major regional indices ended mixed ahead of a US inflation update. Nikkei 225 and STI rose 0.38% and 0.12% respectively, to end at 32,377.29 and 3,313.79 respectively. Meanwhile, HSI and SHCOMP fell by 1.81% and 0.25% to close at 19,184.17 and 3,260.62 respectively.

Wall Street ended lower after Moody’s downgrade of several regional banks. The DJIA lost 0.45% to close at 35,314.49. S&P 500 and Nasdaq slipped 0.42% and 0.79% to end at 4,499.38 and 13,884.32 respectively.

News For The Day

Barakah’s PBJV lands contract from Brunei Shell Petroleum

Barakah Offshore Petroleum has bagged a contract from Brunei Shell Petroleum Co SB for the SPM2 replacement project at an undisclosed value. The company received the letter of award from Brunei Shell Petroleum, whereby the main contract scope is to supply engineering work, supply of materials, fabrication, load-out, decommission, installation and commissioning of one unit SPM2 (Single Point Mooring Buoy) at the shoreline of Brunei Darussalam.-The Edge Markets

Sunview secured solar power production quota of 60MW

Sunview Group said two of its subsidiaries have been selected to be solar power producers under the Corporate Green Power Programme, (CGPP), with a combined allocated export capacity of nearly 60 megawatts (MW). The renewable energy player said Solarcity REIT SB and Fabulous Sunview SB were among the 22 entities selected from a pool of 71 applicants in a competitive bidding exercise conducted by the Energy Commission.- The Edge Markets

Malaysia's IPI eases 2.2% in June 2023

Malaysia's Industrial Production Index (IPI) fell 2.2% YoY in June 2023, attributed to a contraction in the manufacturing and mining sectors, according to the Department of Statistics Malaysia (DoSM). Chief statistician Datuk Seri Mohd Uzir Mahidin said the manufacturing sector saw a decline of 1.6% in June (May 2023: +5.1%) while the mining sector recorded negative 6.4% (May 2023: +2.9%).– The Star

Aemulus stays in the red in 3QFY6/23

Aemulus Holdings has incurred its third straight quarterly loss amid cautious capital expenditure spending from customers expecting a slowdown in the semiconductor industry and deferment of delivery due to a slowdown in customers’ expansion pace. The company saw its net loss widening to RM6.9m for 3QFY6/23) from RM4.7m QoQ. The group had reported a net profit of RM1.7m YoY. - The Edge Markets

US chip plan stalls with key jobs taking months to fill

US chipmakers are struggling to fill key positions, a new study shows, as a shortage of skilled labour threatens to hobble efforts to revive the domestic industry. Chipmakers have long sounded the alarm that the US doesn’t have enough job candidates with a background in science, technology and engineering. The firms are on course to add 115,000 jobs by 2030, according to the Semiconductor Industry Association.- The Edge Markets

Our Thoughts

Wall Street closed lower following Moody’s downgrade on the US banking sector reigniting concerns of potential crisis within the sector. The DJI Average lost 159 points while the Nasdaq declined by 110 points as the US 10-year yield inched past the 4% mark to 4.028%. In Hong Kong, the HSI slumped 354 points or to a 2-week low on concerns over China’s slowdown after its exports dipped 14.5% in July which was the biggest decline in 3 years while imports fell 12.4% vs the 5.6% estimate. Back home, the FBM KLCI maintained its uptrend to stay above the 1,450 level as foreign buying continue especially on the Banks yesterday. While we believe the index to see more upside going forward, fresh concerns over the US banks may impact sentiment in the immediate term hence expect the index to trend within the 1,445-1,455 range today. We noticed CPO price has weakened sharply over the past week thus may add pressure to the Plantation sector.

Source: Rakuten Research - 9 Aug 2023

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