Previous Day Highlights

FBM KLCI closed marginally lower amid the weakness across the region. The benchmark index was down 0.10% or 1.51 pts to close at 1,547.60. Gainers were seen in transportation (+1.09%), telecommunications (+1.02%), and energy (+0.68%); while losers were the technology (-1.27%), plantation (-1.22%), and REIT (- 0.55%) sectors. Market breadth was negative with 633 losers against 443 gainers. Total volume stood at 3.74bn shares valued at RM3.12bn.

Major regional indices trended lower except Nikkei 225 which gained 0.35% to close at 39,233.71. HSI declined 0.54% to end at 16,634.74. SHCOMP dropped 0.93%, to close at 2,977.02. STI slid 0.43%, to close at 3,171.12.

Wall Street closed lower following the recent rally. The DJIA dropped 0.16%, to end at 39,069.23. Nasdaq eased 0.13%, to close at 15,976.25. S&P500 eased 0.38%, to finish at 5,069.53.

News For The Day

Inari's 2Q net profit down 7% as power, other costs drag

Inari Amerton's 2QFY6/24 net profit fell 7.26% YoY to RM86.81m from RM93.61m, due to set-up costs for new products and higher electricity costs. The decline more than offset the impact of higher revenue, which rose 2.89% YoY to RM414.08m from RM402.46m, thanks to a high loading volume in radio frequency (RF) and optoelectronics segments, it said. Inari declared a dividend of 2.2 sen per share.-The Edge Markets

LPI Capital net profit up 44% to RM78.6m in 4Q

LPI Capital posted a higher 4QFY12/23 net profit of RM78.58m compared with RM54.61m YoY. Quarterly revenue rose to RM481.3m against RM380.5m YoY, mainly contributed by higher insurance revenue, higher interest and dividend income. The group has declared dividend of 40.0 sen per share.-The Star

Allianz Malaysia’s 4Q profit rises 12%

Allianz Malaysia’s 4QFY12/23 net profit rose 11.69% YoY to RM193.69m from RM173.46m, lifted by better contribution from life insurance segment. General insurance and investment holding segments reported lower earnings for the quarter due to higher claims and expenses. 4QFY23 revenue grew 13.43% YoY to RM1.31bn from RM1.15bn. It paid RM1.005 sen per share in dividends for FY23.-The Edge Markets

Lower sales orders drag SKP’s 3Q net profit down 42%

SKP Resources posted a 42.48% YoY drop in its 3QFY3/24 net profit to RM23.44m from RM40.74m, on reduced sale orders amid softer market demand. Its 3QFY24 revenue declined 38.78% YoY to RM453.1m from RM740.13m. The group will remain vigilant with its future order books and ensure a highly efficient operating structure.-The Edge Markets

Karex's 2Q net profit triples thanks to higher margin products

Karex’s 2QFY6/24 net profit jumped three-fold to RM7.32m from RM2.03m, as it sold more high margin products. This is despite quarterly revenue dipping 0.89% YoY to RM127.37m from RM128.51m primarily attributed to slower condom sales in the tender market but was also partially offset by strong personal lubricants sales. -The Edge Markets

T7 Global posts record-high profit

T7 Global’s 4QFY12/23 net profit rose 26% YoY to record as revenue rose faster than operating expenses. 4QFY23 net profit was RM14.38m compared with RM11.42m. Revenue surged nearly 50% YoY to RM250.75m from RM167.73m, amid high oil and gas prices, increased capital spending and the reopening of China’s borders. -The Edge Markets

Our Thoughts

Wall Street closed lower after a record breaking run last week as traders are now focusing on fresh economic data as high interest rate regime may linger a bit longer. As a result, the DJI Average lost 62 points while the Nasdaq declined 21 points with the US 10-year yield inching higher at 4.28%. Over in Hong Kong, the HSI ended lower as traders were sidelined while waiting for quarterly results from the likes of Baidu, Li Auto and HKEX coupled with hopefully more stimulus from Beijing. Back home, the FBM KLCI closed slightly lower as profit taking activities set in during the afternoon session. Though daily volume remains low, recent influx of foreign funds into the local bourse will see an expansion of valuation amongst the blue chips that may have positive impacts on the smaller cap stocks going forward. For today, we expect the index to hover within the 1,545-1,555 range.

Source: Rakuten Research - 27 Feb 2024

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