Previous Day Highlights

FBM KLCI closed lower due to selling pressure emerged during the final hour of trading session. The benchmark index down 0.35% or 5.24 pts to close at 1,511.34. Gainers were seen in telecommunications (+0.69%), consumer (+0.23%), and health care(+0.14%); while losers were seen in utilities (-1.39%), energy (-1.28%), and property (- 0.98%). Market breadth was negative with 605 losers against 390 gainers. Total volume stood at 3.22bn shares valued at RM2.12bn.

Major regional indices trended broadly lower as sentiment remained cautious amid China's property woes. HSI declined 0.15%, to end at 15,510.01. SHCOMP dropped 1.02%, to close at 2,702.19. Nikkei 225 up 0.54%, to finish at 36,354.16. STI slid 1.43%, to close at 3,134.29.

Wall Street closed lower due to surge in bond yields. The DJIA lost 0.71%, to end at 38,380.12. Meanwhile Nasdaq and S&P500 fell by 0.32% and 0.20% to close at 4,942.81 and 15,597.68 respectively.

News For The Day

Chin Hin triggers MGO after raising stake in SIB

Chin Hin Group has proposed to acquire 4.77% or 30.29m ordinary shares in Signature International (SIB) for RM25.4m or 84 sen per share. Chin Hin said it has entered into conditional share sale agreements with Teoh Hai Hin and Por Teong Eng for the proposed acquisition. Chin Hin will be obliged to extend a conditional mandatory general offer (MGO) for all the remaining SIB shares not already owned at a cash offer price of 84 sen per SIB share. -The Star

AME REIT says 3Q net income up 19%

AME Real Estate Investment Trust (AME REIT) saw its 3QFY3/24 net income grow 19.4% YoY to RM9.95m from RM8.33m, driven by additional contributions from three industrial properties acquired from sponsor AME Elite Consortium. AME REIT declared an income distribution of 1.88 sen per unit, with Feb 20 being the ex-date. -The Edge Markets

Coastal Contracts gets RM318.9m contract extension

Coastal Contracts has signed an addendum to extend its gas sweetening services contract up to Dec 31, 2025, with Mexican state-owned petroleum company Petroleos Mexicanos. Coastal Contracts said the maximum contract value has increased to MXN2.78bn, representing an increase of MXN1.14bn, which is equivalent to approximately RM318.9m. -The Star

Thai JWD emerge as Swift Haulage's substantial shareholder

Swift Haulage’s substantial shareholder Persada Bina SB, which currently holds 309.62m shares or a 35.16% stake in the company, is selling an 11.16% stake or 98.27m shares in the company to Singapore-based logistics company JWD Asian Holding Pte Ltd for RM61.9m or 63 sen apiece cash. The proposed disposal is expected to be completed on Feb 22. -The Edge Markets

Vestland bags RM279m job for service apartments in PJ

Vestland has bagged a RM278.81m contract from Sg Besi Construction SB to undertake design and building works for two blocks of service apartments and related facilities in Ara Damansara, PJ. Construction works will commence effective immediately, with completion on 4 Aug 2026. -The Edge Markets

Hua Yang 3Q earnings jump more than triple

Hua Yang’s 3QFY3/24 net profit more than tripled to RM2.38m from RM769,000 YoY, thanks to steady construction progress of its apartment project in Bukit Mertajam, Penang. Hua Yang’s revenue nearly doubled to RM58.66m from RM29.84m YoY. -The Edge Markets

Our Thoughts

Wall Street ended lower after the US 10-year Treasury note was gained more than 13 basis points to 4.166% as investors assessed a fresh batch of strong economic data that suggested rates may stay elevated for longer than anticipated. The Dow dived 274 points (0.71%) while the Nasdaq erased 32.3 points (-0.2%). In Asia, major indices closed lower as the better-than-expected US job report diminished any possibilities of an immediate interest rate cut by the Fed. The HK market ended lower with selling on real estate and tech stocks. The HSI fell 23.5 points (0.15%). On the domestic front, the FBM KLCI finished lower due to profit taking activities. Nonetheless, we interpret this as a positive correction, enabling the market to absorb the recent rally. We expect the buying on local stocks to continue given the attractive valuations and persistent support from foreign funds. As such, we anticipate the benchmark index to trend within the range of 1,510- 1,520 for today.

Source: Rakuten Research - 6 Feb 2024

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