Previous Day Highlights

FBM KLCI closed higher ahead of the tabling of Budget 2024 on Friday. The benchmark index was up 0.51% or 7.33 pts to close at 1,443.82. Majority of sectors were positive with construction (+1.6%), property (+1.3%), and industrial products & services (+1.1%), leading the gains; while losers were plantation (-0.4%), and energy (-0.3%). Market breadth was positive with 587 gainers against 341 losers. Total volume stood at 3.38bn shares valued at RM2.03bn.

Major regional indices trended positively. HSI and SHCOMP gained 1.93% and 0.94% to close at 18,238.21. 3,107.90 respectively. Meanwhile, Nikkei 225 and STI both rose 1.75% and 0.65% to end at 32,494.66 and 3,213.62 respectively.

Wall Street ended lower as inflation data reignites interest rate fears. The DJIA lost 0.51% to 33,631.14. S&500 and Nasdaq slipped 0.62% and 0.63% to finish at 4,349.61 and 13,574.22 respectively.

News For The Day

IJM secures RM1.1bn job for JB-Singapore RTS Link project

IJM Corp announced on that its wholly-owned subsidiary IJM Construction SB has accepted a RM1.1bn contract from Malaysia Rapid Transit System SB (MRTS) for the construction of an immigration, customs and quarantine complex (ICQC) for the Johor Bahru–Singapore Rapid Transit System (RTS) Link in Bukit Chagar, Johor Bahru.-The Edge Markets

OpenSys gets RM105m contract from Maybank

Opensys has accepted a letter of award from Maybank worth RM105m to process the latter’s outward clearing cheques for all its branches nationwide commencing from Jan 1, 2024 to Dec 31, 2030. “The contract has no provision for automatic renewal. It will have no effect on the share capital and shareholding structure of the company, but it is expected to contribute positively to the earnings and net assets per share of the group from FY24 until the expiry of the contract,” it said. -The Star

Bumi Armada gets nod to bid for FLNG jobs globally

Bumi Armada's approval from the American Bureau of Shipping (ABS) for a proposed floating LNG (FLNG) concept is expected to open doors for the company. The offshore services provider said it had developed the barge-based liquefaction unit for a standardised LNG design capacity based on a modularised and repeatable compact design.- The Star

Eversendai bidding tenders worth RM15bn in Saudi Arabia

Eversendai Corp said it has submitted active tenders for more than RM15bn worth for structural steel projects in Saudi Arabia which are highly complex, befitting Eversendai's technical capabilities. The company said it has a 200,000- tonne annual fabrication capacity in Malaysia, Singapore, India, United Arab Emirates (UAE) and Qatar, and is now in the process of establishing a 60,000-tonne annual fabrication capacity factory near Riyadh, Saudi Arabia.

KNM sues former exec directors for RM17m

KNM Group and its indirect wholly owned subsidiaries Deutsche KNM GMBH and Borsig GMBH have sued Flavio Porro and Terence Tan Koon Ping, after KNM called off the disposal of Borsig to Vorsprung Industries GMBH for €220.8m (RM1.107bn) in December 2022.-The Edge Markets

Our Thoughts

Wall Street closed lower as the CPI figure for September showed no signs of weakening and as a result, pushed the US 10-year yield higher to 4.697% and that the Federal Reserves may need to hike rates next month. As such, the DJI Average declined 174 points while the Nasdaq dipped by 75 points. In Hong Kong, the HSI jumped 345 points higher underpinned by the emergence of Central Huijin which is part of China’s Sovereign wealth fund, mopping up shares of several banks namely ICBC, Construction Bank, Bank of China and Agriculture Bank. On the local front, the FBMKLCI maintained its uptrend possibly attributed to firm buying support from local institutions. As we wait for the return of Dato Seri Anwar to table Budget 2024 later today, we remain quite optimistic that there may be some pleasant surprises in store. Nonetheless, we expect the benchmark index to hover within the 1,440-1,450 range today. Again, we advocate investors to focus on value stocks like the Banks and Telcos plus sectors like Construction, Industrial Products and Property as dark horses.

Source: Rakuten Research - 13 Oct 2023

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