Previous Day Highlights

FBM KLCI continue to slide tracking the broader regional markets. The benchmark index was down 0.49% or 7.53 pts to close at 1,535.00. All the sectors were negative with construction (-2.7%), property (-2.5%), and energy (-1.7%) leading the losses. Market breadth was negative with 1139 losers against 173 gainers. Total volume stood at 4.93bn shares valued at RM3.72bn.

Major regional indices trended negatively due to the on- going tension in the Middle East. HSI declined 2.12%, to end at 16,248.97. SHCOMP dropped 1.65%, to close at 3,007.07. Nikkei 225 plunged 1.94%, to finish at 38,471.20. STI fell 1.22%, to close at 3,144.76.

Wall Street closed mixed as investors digested Federal Reserve Chair Jerome Powell’s inflation forecast. The DJIA added 0.17%, to end at 37,798.97. Nasdaq eased 0.12%, to close at 15,865.25. S&P500 dropped 0.21%, to finish at 5,051.41.

News For The Day

Malaysia needs up to RM90bn to fund critical energy projects

Malaysia requires an allocation of RM60bn to RM90bn to fund critical projects involving energy transition over the next 10 years, said Natural Resources and Environmental Sustainability Minister Nik Nazmi Nik Ahmad. He said the requirements encompass expanding public transportation, strengthening grid infrastructure, and upskilling the workforce. "A crucial component will be a robust and adaptable grid to handle the increasing reliance on renewable energy sources. The estimated cost for grid development is likewise substantial, reaching RM180bn by 2050.” -The Star

Alpha IVF makes RM13.6m net profit in 3Q

Alpha IVF Group made its 3QFY5/24 net profit of RM13.59m, on a revenue of RM40.7m. The revenue came mostly from the provision of assisted reproductive services focusing on in-vitro fertilisation (IVF) treatments. For its 9MFY24, Alpha IVF posted a net profit of RM38.92m, on a revenue of RM120.84m. Alpha IVF said there has been an increase in demand for IVF treatment services from overseas patients returning to Malaysia, driven by a resurgence of medical tourism following the reopening of borders. -The Edge Markets

Globetronics in final talks for advanced packaging

Globetronics is in finalisation stages to have two potential new customers interested in leveraging advanced packaging technology, initiate transfer of memory and automotive products, some of which will start 2HFY12/24. The new business segment, which will enable Globetronics to package semiconductor chips supportive of AI technology, is poised to become the group’s growth driver. -The Edge Markets

GDEX plans to diversify into IT

GDEX is planning to diversify into the provision of information technology (IT) services and solutions to enhance its revenue stream. The last-mile logistics player previously acquired equity stakes in three IT companies in 2022, namely Web Bytes SB (38% stake), Sweetmag Solutions SB (51%), and Anon Security SB (60%). These acquisitions marked the start of its transformation plan to turn the company around. -The Edge Markets

Tomei declares 4sen dividend for FY23

Tomei Consolidated has declared a first and final dividend of four sen per share for FY12/23. The dividend, amounting to RM5.54m, will be paid on June 6. The group expects to achieve a “reasonable level of profitability” in FY24 amid the uncertain business outlook due to global conflicts. -The Edge Markets

Our Thoughts

Wall Street ended mixed amid a choppy session as sentiment remains cautious whereby traders are trying to balance the narratives on interest rates coupled with the tension in the Middle East. As such, though the DJI Average gained 64 points, the Nasdaq lost 20 points as the US 10-year yield inched higher at 4.669%. In Hong Kong, the HSI slumped to hover precariously just above the 16,000 level as China’s higher than expected economic growth for the 1Q2024 failed to convince investors as both the retail and industrial output data came in lower than anticipated. Back home, the FBM KLCI saw more selling on blue chips possibly by foreign funds as the index dipped below the 1,540 mark. The selling was broad-based in line with the regional bloodbath. We believe yesterday’s selling was more of a knee jerk reaction to the escalation tension in the Middle East amid the flight of funds to other asset classes. Therefore, we believe some bargain hunting activities to emerge anytime soon and expect the index to trend within the 1,530-1,540 range today.

Source: Rakuten Research - 17 Apr 2024

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