Rakuten Trade Research Reports

Daily Market Report - 21 Feb 2024

Publish date: Wed, 21 Feb 2024, 12:16 PM
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Previous Day Highlights

FBM KLCI continued to climb and closed at its intra-day high, driven by the persistent buying activities across the board. The benchmark index was up 1.10% or 16.98 pts to close at 1,555.59. Majority of sectors were positive with energy (+5.7%), industrial products & services (+1.2%), and utilities (+0.9%) leading the gains; while losers were seen in transportation (-0.2%), and REIT (-0.2%). Market breadth was positive with 615 gainers against 425 losers. Total volume stood at 3.70bn shares valued at RM2.94bn.

Major regional indices trended mostly higher following Beijing’s efforts to revive its property market. HSI gained 0.57%, to end at 16,247.51. SHCOMP increased 0.42%, to close at 2,922.73. Nikkei 225 eased 0.28%, to finish at 38,363.61. STI rose 0.56%, to close at 3,244.06.

Wall Street closed broadly lower, weighed down by sell- off in tech stocks. The DJIA dropped 0.17%, to end at 38,563.80. Nasdaq eased 0.92%, to close at 15,630.78.S&P500 eased 0.60%, to finish at 4,975.51.

Our Thoughts

Wall Street ended on a weak note as prevailing high valuations remain as the main stumbling block. In addition to the widely expected delay in rate cut, traders are wary if US equities have the legs to trend higher. As such, the DJI Average lost 64 points while the Nasdaq declined by 145 points as the US 10-year yield eased marginally to 4.275%. In Hong Kong, the HSI after a weak opening, rebounded in the afternoon session following the 25bps cut in loan prime rate by Chinese lenders which is higher than initially expected to spur home purchases. At home, the FBM KLCI maintained its impressive performance as it closed above the 1,550 mark. This resembles a mini CNY rally as the index have added more than 40 points during the period. Though an intermittent correction may prevail, we believe the local bourse to sustain this solid performance as we march towards the 1,600 level. It is also heartening to see that retail presence is improving though actual participation is still low. For today, we expect the index to hover within the 1,550-1,560 range.

News For The Day

CelcomDigi says 4Q net profit more than triples

CelcomDigi said its net profit more than tripled in 4QFY23 following its merger but flagged higher costs ahead. Its 4QFY12/23 net profit was RM435.11m compared to RM127.36m YoY. Revenue for the quarter surged 50% YoY to RM3.27bn from RM2.18bn. The company flagged “higher integration costs” as it is embarking on what it said would be a “transformative journey” for its operating models. The company declared a fourth interim dividend of 3.5 sen per share, bringing the total dividend to 13.2 sen per share for the year.-The Edge Markets

SunCon posts 7.9% rise in 4Q profit, raises orderbook target

Sunway Construction Group (SunCon) reported a 7.93% YoY increase in 4QFY12/24 net profit to RM49.27m compared to RM45.65m, thanks to higher progress billings and output at its precast segment. Revenue for the quarter surged 73.11% YoY to RM871.50m from RM503.43m. For 2024, SunCon said it is aiming for a higher order book target of RM2.5bn to RM3.0bn. The group also declared a single-tier second interim dividend of three sen per ordinary shares for the quarter. -The Edge Markets

Hume Cement’s 2Q profit up 13 fold YoY, best since 2003

Hume Cement Industries posted 13-fold YoY increase for its 2QFY6/24 net profit to RM59.06m, on improved cement selling prices and sales volume, best quarterly performance since 3QFY03. Revenue rose 26.24% YoY to RM322.25m from RM255.27m. Hume Cement noted improvement in construction activities on the recent better performance and expects the sector “to sustain its momentum” in the FY24.-The Edge Markets

Dutch Lady flags higher costs as revenue rises to RM1.4bn

Dutch Lady’s 4QFY23 saw its revenue inching up by 0.8% YoY to RM364.53m from RM361.69m driven by continued effects of revenue growth management initiatives earlier in the year to mitigate the impact of inflationary headwinds. Dutch Lady reported its 4QFY23 net profit of RM22.83m compared to a net loss of RM20.23m YoY, as a result of revenue growth, cost price improvements driven by softening dairy raw material prices as well as lower one-off costs. For its FY23, Dutch Lady’s revenue rose by 7.7% YoY to RM1.44bn, while net profit surged by about 56% to RM72.39m. -The Star

Teo Seng reports over 5-fold profit jump in 4Q23

Teo Seng Capital, which saw its 4QFY12/23 net profit surge over five folds to RM66.9m, expects to sustain its financial performance in FY24. Teo Seng’s revenue in 4Q23 rose 10.6% YoY to RM199.8m from RM180.6m while earnings per share jumped to 22.80 sen from 4.43 sen previously. -The Star

Source: Rakuten Research - 21 Feb 2024

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