Rakuten Trade Research Reports

Daily Market Report - 27 Sep 2023

Publish date: Wed, 27 Sep 2023, 09:18 AM
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Previous Day Highlights

FBM KLCI ended higher due to bargain hunting activities The benchmark index gained 0.14% or 2.1 points to close at 1,445.55. Gainers were led by KLK, AXIATA and PPB. However, market breadth was negative with 564 losers against 367 gainers. Total volume stood at 3.16bn shares valued at RM1.95bn.

Major regional indices trended lower. Nikkei225 and STI eased 1.11% and 0.01% to end at 32,315.05 and 3,215.07 respectively. HSI and SHCOMP lost 1.48% and 0.43% to close at 17,466.90 and 3,102.27 respectively.

Wall Street closed broadly lower. The DJIA lost 1.14% to end at 33,618.88. S&P500 and Nasdaq slumped 1.47% and 1.57% to finish at 4,273.53 and 13,063.61 respectively.

News For The Day

TNB expects RM7bn recovery from ICPT in 1H24

Tenaga Nasional (TNB) has estimated a recovery of about RM7bn from imbalance cost pass-through (ICPT) in the 1HFY24, based on current fuel price trends. TNB president and chief executive officer Datuk Baharin Din said that the development significantly enhances TNB’s working capital, boosting its cash flow and improving gearing levels in 2023.- The Star

Bumi Armada signs PSC for Akia block

Bumi Armada has signed a production sharing contract (PSC) with the Energy and Mineral Resources Ministry of Indonesia for the Akia PSC in the Tarakan Basin, North Kalimantan Province. Akia PSC covers an area of 8,394 sq km and contains the Aster and Tulip oil and gas discoveries. “The water depth at the Tulip discovery is 800m and Bumi Armada would provide and operate an floating production storage and offloading and a floating liquefied natural gas facility or gas pipeline for the development.”– The Edge Markets

Avaland launches Amika Residences sales gallery Avaland inaugurated its sales gallery for Amika Residences, its

latest project in Subang Jaya. CEO Teh Heng Chong said the 3.5-acre, freehold Amika Residences, has a GDV of RM475m is located immediately next to Alira Subang Jaya. The design of Amika Residences utilises positive elements of Alira Subang Jaya that were highlighted in customer feedback.–The Edge Markets

Senheng buys distribution centre for RM76m

Senheng New Retail has proposed to acquire a piece of land together with the buildings erected, which is currently being used as a central distribution centre (CDC), for RM75.8m cash. The asset is currently being rented by Senheng KL from the vendor and used as the CDC for Senheng and its subsidiaries. Senheng said the acquisition will result in significant annual gross rental savings of RM4.2m for the group.– The Star

Puncak Niaga’s Ijok land could be sold at higher loss

Puncak Niaga Holdings is believed to be undertaking a revaluation exercise on the three pieces of land in Ijok, Selangor, that it is selling to Alpha Galaxy SB and Alpha Galaxy 1 (together, Alpha Galaxy). If the land’s value rises but the purchase price is not revised accordingly, Puncak Niaga could find itself recording a bigger loss on paper from the disposals to Alpha Galaxy. The value of the land increased between 2020 and 2022.-The Edge Markets

Our Thoughts

Wall Street ended with sharp losses as renewed worries about the state of the US economy were triggered by disappointing reports on home sales and consumer confidence. The DJI Average declined by 388 points, and the Nasdaq fell by 207 points. In Hong Kong, the HSI dipped 262 points on concerns over China’s property woes and fears of a slowdown in the world’s second- largest economy. At home, the FBM KLCI added 2 points due to bargain hunting activities. Given the underwhelming showing of Wall Street in the last session, we foresee investors being more cautious in their actions. The Brent Cride futures remained elevated at above US$92 per barrel, we expect the O&G stocks should attract more attention. Given the circumstances, we expect sentiment on the local exchange to become somewhat cautious, which leads us to project the index will hover around the 1,440-1,450 range today.

Source: Rakuten Research - 27 Sep 2023

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