Previous Day Highlights

FBM KLCI retreated from its recent gains, in line with the weak regional performances. The benchmark index was down 0.60% or 9.78 pts to close at 1,619.40. Majority of sectors were negative with health care (-2.6%), utilities (- 1.3%), and transportation (-0.7%) leading the losses; while gainers were seen in technology (+0.5%), and construction (+0.2%). Market breadth was negative with 845 losers against 450 gainers. Total volume stood at 5.61bn shares valued at RM4.58bn.

Major regional indices trended negatively. HSI slumped 1.38%, to end at 18,608.94. SHCOMP dropped 0.88%, to close at 3,088.87. Nikkei 225 tumbled 1.17%, to finish at 38,646.11. STI slid 0.18%, to close at 3,316.56.

Wall Street closed higher, primarily driven by major tech stocks. The DJIA added 0.01%, to end at 39,069.59. Nasdaq rose 1.10%, to close at 16,920.79. S&P500 climbed 0.70%, to finish at 5,304.72.

News For The Day

Gamuda wins RM1.74bn job to build data centre

Gamuda has secured two contracts worth a combined value of RM1.74bn to build a hyperscale data centre for Sime Darby Property at the latter’s Elmina Business Park. The first contract worth RM815m was awarded by Sime Darby Property (EBP Asset I) SB. The second contract worth RM928.6m is from Pearl Computing Malaysia. These projects are scheduled for completion on Feb-26 and Sept-26.-The Edge Markets

Sports Toto's 3Q net profit almost tripled to RM68.5m

Sports Toto reported its 3QFY6/24 earnings almost tripled to RM68.45m compared with RM23.22m YoY, on the back of improved performance by the group's principal subsidiary STM Lottery SB and luxury cars retailer HR Owen plc. Quarterly revenue inched up 2.4% YoY to RM1.69bn from RM1.66bn. It declared a third interim dividend of three sen per share, amounting to RM40.5m, payable on July 19.-The Edge Markets

Scientex to acquire 37 land parcels in Penang for RM462.5m

Scientex’s wholly-owned subsidiary, Scientex (Skudai) SB, has entered into a conditional sale and purchase agreement with Land Capacity SB to acquire 37 parcels of freehold land in Penang for RM462.49m. The proposed acquisition is expected to be completed in 1H25. -The Star

MHB’s 1Q net profit triples on revenue from higher activities

Malaysia Marine and Heavy Engineering Holdings 1QFY12/24 net profit almost tripled YoY to RM10.42m versus RM3.53m, thanks to higher revenue from ongoing projects as well as increase in dry-docking and repair activities. Revenue almost doubled YoY to RM984.47m from RM496.23m. -The Edge Markets

TRC Synergy secures RM142.34m project

TRC Synergy wholly-owned subsidiary Trans Resources Corporation SB (TRC) has bagged a RM142.34m sub-contract for architectural, structural and civil works for the "proposed transformation” of a state legislative building. It said the subsidiary has received and accepted the letter of acceptance from the Performing Arts Centre Consortium SB. -The Star

Aneka Jaringan bags RM22.5m subcontract from IJM

Aneka Jaringan Holdings has bagged a RM22.5m subcontract from IJM Construction SB to undertake bored piling works for the Figure 8 Interchange and Ibrahim International Business District in Johor, the works which come under the JB-Singapore Rapid Transit System Link project. It said the subcontract is expected to be completed on Nov 14, 2024.-The Star

Our Thoughts

Wall Street closed positively as the AI frenzy continues spearheaded by Nvidia. This is despite deteriorating expectations that the Federal Reserve will lower interest rates soon. As such, the DJIA added 4 points while the Nasdaq surged by 185 points to end on a record high as the US 10-year yield eased to 4.467%. In Hong Kong, the HSI declined further as outlook on lower US interest rates wanes coupled with the absence of earnings surprises. The HSI lost almost 1,000 points over the last 5 days. Back home, the FBM KLCI ended the week negatively at just above the 1,620 threshold seemingly a strong support level as selling continues amid a weak regional performance. Nonetheless, we believe some bargain hunting activities to take place today spurred by decent corporate earnings reported thus far. We noticed except for the Planters, most sectors had reported an encouraging set of earnings for 1Q24. Therefore, we expect the index to hover between the 1,615-1,625 range today.

Source: Rakuten Research - 27 May 2024

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