Previous Day Highlights

FBM KLCI closed lower due to regional weakness. The benchmark index lost 0.13% or 1.89 points to end at 1,446.09. Losers were led by PETDAG, PMETAL and CIMB. Market breadth was negative with 552 losers against 380 gainers. Total volume stood at 3.19bn shares valued at RM2.11bn.

Key regional indices ended lower. Nikkei225 and STI lost 0.55% and 0.71% to close at 31,450.76 and 3,173.93 respectively. HSI and SHCOMP slumped 2.05% and 1.00% to 17,950.85 and 3,173.93 respectively.

Wall Street trended broadly lower with selling mainly on tech stocks. The DJIA gained 0.07% to close at 34,500.66. Meanwhile S&P 500 and Nasdaq dipped 0.01% and 0.20% to end at 4,369.71 and 13,290.78 respectively.

News For The Day

CelcomDigi 2Q net profit jumps 56% to RM343m

CelcomDigi's 2QFY23 net profit jumped 56.11% YoY to RM343.5m from RM220.0m a year ago, as revenue doubled to RM3.12bn from RM1.54bn. The telco declared a second interim dividend of 3.2 sen per share, amounting to RM375m, with an entitlement date of Sept 6 and a payment date of Sept 29. “As key projects have commenced in June 2023 onwards, the company expects capex to ramp up for the remaining two quarters of FY2023," said the telco in a separate statement.– The Edge Markets

EPF outsourced RM160.24bn in 2022

The Employees Provident Fund (EPF) outsourced RM160.24bn of its total investment assets to external fund managers last year, down 4.4% from RM167.63bn in 2021. In a statement on Saturday (Aug 19), the retirement fund said the allocation was invested across both equity and fixed income instruments, representing 16.12% of the EPF’s total investment assets.- The Edge Markets

Kelington’s 2Q net profit rises to RM19m

Kelington Group’s 2QFY23 net profit increased to RM19.1m from RM13.3m YoY. The board of directors proposed the payment of a first interim tax-exempt dividend of 1.5 sen per share in respect of the FY2023 to be paid on Oct 2, 2023, - The Star

CSC Steel's 2Q net profit falls 13%

Steel manufacturer CSC Steel Holdings’s 2QFY23 net profit fell 12.71% YoY to RM14.9m due to the absence of disposal gain of an investment property and lower revenue. Looking forward, the group expects the steel market to continue to be volatile in the third quarter of 2023. A lack of upward momentum coupled with cost inflation and a continued flood of imports due to uplifted trade barriers will put the steel market in uncertainty, it added.-

The Edge Markets

Guocoland 4Q net profit falls 34%

Guocoland’s 4QFY6/23 net profit fell 33.6% YoY to RM15.8m or mainly due to lower contribution from its property development division. The company also booked a one-off land disposal located in Mukim and District of Jasin, Melaka that contributed revenue of RM19m and profit before tax of RM12.7m.- Edge Markets

UEM Sunrise’s 2Q net profit rises 19%

UEM Sunrise posted a 2QFY23 net profit of RM24.7m, up 19.3% YoY due to higher share of results from joint ventures (JVs) and associates. In contrast, the property developer’s revenue slipped marginally to RM363.96m from RM365m due to lower revenue contribution of Residensi Solaris Parq in Mont Kiara following its completion in end-2022. - The Edge Markets

Our Thoughts

Wall Street continued to struggle as sentiment remains affected by the US strong economic growth amidst a mixture of inflationary impact and potential rate hikes by the Feds next month. As such, though the DJI Average added 26 points, the Nasdaq declined by 26 points as the US 10-year yield stayed elevated at 4.251%. In Hong Kong, the HSI slumped from persistent sell-down due to concerns on defaults within the property sector and potential fallout of China’s shadow financing. Meanwhile, the Chinese Yuan hit a lowest level versus the US$ since October last year at 7.26. At home, the FBM KLCI closed marginally lower as the benchmark index was under some pressure attributed to regional weaknesses especially from China and Hong Kong. On a broader sense, both the Construction and Technology sectors experienced hefty selling. As mentioned, we need to see the index to stage a rebound as soon as possible and it is encouraging to note that buying interests remained rather strong during the afternoon session last Friday. Thus, for today, we expect the index to trend between the 1,445-1,455 range.

Source: Rakuten Research - 21 Aug 2023

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