Previous Day Highlights

FBM KLCI closed lower in tandem with the weak performance across the region. The benchmark index was down 0.11% or 1.56 pts to close at 1,453.10. Gainers were seen in utilities (+2.80%), construction (+0.99%), and industrial products & services (+0.79%); while losers were seen in plantation (-0.57%), technology (-0.44%), and consumer (-0.16%). However, market breadth was positive with 512 gainers against 463 losers. Total volume stood at 4.91bn shares valued at RM2.01bn.

Major regional markets kick off 2024 on a low note dampened by a weak consumer recovery from China. HSI declined 1.52%, to end at 16,788.55. SHCOMP dropped 0.43%, to close at 2,962.28. STI slid 0.32%, to close at 3,229.95. Meanwhile, Nikkei 225 was closed for New Year Holiday.

Wall Street closed the first trading session of 2024 mostly lower on waning rate cut optimism. The DJIA added 0.07%, to end at 37,715.04. Nasdaq eased 1.63%, to close at 14,765.94. S&P500 slid 0.57%, to finish at 4,742.83.

News For The Day

Sunview inks MOU with Saudi-based firm on RE projects

Sunview Group has via its wholly-owned Fabulous Sunview SB inked a Memorandum of Understanding (MOU) with Saudi Arabia-based Vision Ambassadors Company for International Trade Consultancy to seek renewable energy development and investment opportunities. The collaboration will jointly identify locations of potential projects, with both parties serving as the principal investors.- The Edge Markets

Nestcon bags RM252m construction job in Klang Valley

Nestcon has bagged RM251.5m in construction works for a mixed development in Mukim Petaling in the Klang Valley. Nestcon said its wholly-owned Nestcon Builders SB had accepted a Letter of Award (LOA) from Altimas SB. The work under the LOA consists of main building works for the proposed mixed development of parcel 2, one block of 30- storey apartment suites (408 units) and one block of 34-storey apartment suites (526 units) comprising amenities, car parks and shops. The completion of the contract works is within 34 months, which will commence on Jan 3 and is scheduled for completion by Nov 2, 2026. -The Edge Markets

HeiTech Padu gets RM58.89m IRB contract

Heitech Padu has accepted and signed a letter of award from the Inland Revenue Board (IRB) for a “Next Generation Network” service, worth RM58.89m. HeiTech Padu said the contract is for a period of three years and six months, commencing from Jan 1, 2024 to June 30, 2027. -The Star

Edaran bags RM356.56m contract

Edaran has secured a RM356.56m contract to provide hardware and software rental services to the Royal Malaysian Customs Department. The technology company said its wholly-owned Edaran IT Services SB secured the 48-month contract from the Ministry of Finance (MOF), and that the letter of award was accepted on Tuesday. “Proceeds from the contract shall contribute towards the earnings of the group FY24 until FY28,” it said. -The Edge Markets

AGX inks IPO underwriting deal with TA Securities

AGX Group has entered into an underwriting agreement with TA Securities Holdings for the company's initial public offering (IPO) on the ACE Market of Bursa Malaysia. The company said the IPO comprises a total public issue of 96.5m new shares and an offer for sale of 30m existing shares. Through its subsidiaries, the AGX Group is primarily a third-party logistics (3PL) service provider. -The Star

Our Thoughts

Wall Street closed on a mixed note as the recent massive rally may have seen some market indigestions as valuations outpaced fundamentals. This is further aggravated to Barclays downgrade on Apple which saw the stock decline by 3%. As such, the DJI Average gained 25 points while the Nasdaq lost 245 points with the US 10- year yield inched higher to 3.941%. Over in Hong Kong, the HSI started the new year on a weak note as sentiment remains cautious following the latest economic data from China which showed uneven recovery and that overall confidence is still subdued. On the home front, the FBM KLCI settled lower as trading remains lacklustre over a mixed regional performance. Additionally, some rumblings on the political scene further set aside interests on the local bourse. Notwithstanding this, we believe the time is right to nibble on some Banking and Construction stocks as we noticed more jobs are in the pipeline thus expect the index to trend within the 1,450- 1,460 range today.

Source: Rakuten Research - 3 Jan 2024

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