Previous Day Highlights

The FBM KLCI closed flat due to a lack of buying interest amid the mixed performance of regional markets. Nonetheless, the benchmark index finished in positive territory and gained 0.03% or 0.38 pts to 1,417.26. Gainers were seen in energy (+2.09%), utilities (+0.56%), and telecommunications (+0.35%); while losers were seen in construction (-0.58%), transportation (-0.54%), and property (-0.47%). Market breadth was negative with 447 losers against 343 gainers. Total volume stood at 2.88bn shares valued at RM1.78bn.

Major regional indices trended mixed. HSI gained 0.18% to close at 17,517.40. SHCOMP and STI declined 0.44%, and 0.26% to close at 3,096.92 and 3,166.25 respectively. Meanwhile, the Japanese market was closed for holiday.

Wall Street closed higher as investors digested the latest conflict between Israel and Hamas. The DJIA added 0.59%, to close at 33,604.66. Nasdaq and S&P500 rose 0.39% and 0.63% to finish at 13,484.24 and 4,335.65 respectively.

News For The Day

PChem to build Asia’s largest chemical recycling plant

Petronas Chemicals Group (PChem) has reached a final investment decision (FID) to construct Asia’s largest advanced chemical recycling plant in Pengerang, Johor with a capacity of 33 kilotonnes per annum (ktpa). The plant, which is targeted to be operational by the first half of 2026, is part of PChem’s new plastics economy agenda to support the transition towards a circular economy and contribute to a sustainable plastics ecosystem.-The Edge Markets

T7 Global unit secures RM21.17m smart meters contract

T7 Global's subsidiary T7 Wenmax SB has received a RM21.17m contract for the supply of 79,800 units of single phase radio frequency smart meters with 19,950 units of three phase radio frequency smart meters. "According to TNB’s annual report 2022, the targeted smart meters to be installed is 9m units by the end of 2029 and we look forward to continue participating in this project," said T7 Global group CEO Tan Kay Zhuin.-The Edge Markets

CPE Technology inks underwriting agreement with KAF IB

CPE Technology and its subsidiary companies have signed an underwriting agreement with KAF Investment Bank as the principal adviser, underwriter and placement agent for the group’s initial public offering (IPO). CPE Technology announced that the IPO exercise would involve a public issue of over 167.8m new shares. -The Edge Markets

UMW Toyota Motor reports sustained sales growth in Sep23

UMW Toyota Motor SB achieved a year-to-date (YTD) total sales of 76,511 units as of September 2023 versus 70,872 for the same period a year ago. The carmaker reported an eight per cent YoY increase for the first nine months of 2023.-The Star

Luster plans RM50m share capital reduction

Luster Industries has proposed to undertake a RM50m capital reduction via cancellation of its paid-up share capital to eliminate its accumulated losses. The proposed capital reduction will result in its share capital being reduced to RM262.2m, resulting in a capital reduction of RM50m, which will be utilised to set off its accumulated losses of RM34.68m at the group level. -The Edge Markets

Our Thoughts

Wall Street closed positively after a slow start as traders shook off the deadly Israeli-Hamas conflict late in the session. As a result, the DJI Average jumped 197 points while the Nasdaq gained 53 points. The bond market was closed for Columbus Day yesterday. Nonetheless, crude oil prices surged in a knee jerk reaction from the conflict with the Brent crude edged past US$88/barrel and may derail the Federal Reserves attempts to manage inflation. Over in Hong Kong, the HSI ended 31 points higher as trading resumed in a typhoon interrupted session yesterday. Buying interests were mostly centred on oil related stocks in view of the conflict along the Gaza strip. Back home, the FBM KLCI ended marginally higher supported by buying interests predominantly on Energy stocks. For today, we reckon trading to remain subdued in line with the latest developments in the middle east thus sentiment should stay cautious and expect the index to hover within the 1,415-1425 range today. Meanwhile, we believe Banking stocks may be ripe for some accumulation following its downtrend since early September.

Source: Rakuten Research - 10 Oct 2023

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