Rakuten Trade Research Reports

Daily Market Report - 14 Jun 2024

Publish date: Fri, 14 Jun 2024, 10:42 AM
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Previous Day Highlights

FBM KLCI closed marginally higher amid the mixed regional performance. The benchmark index was up 0.08% or 1.22 pts to close at 1,610.17. Majority of sectors were positive with energy (+3.4%), health care (+1.8%), and technology (+1.8%), leading the gains; while losers were seen in telecomm (-1.2%), and plantation (-0.5%). Market breadth was positive with 798 gainers against 447 losers. Total volume stood at 5.91bn shares valued at RM4.35bn.

Major regional indices trended mixed. HSI gained 0.97%, to end at 18,112.63. SHCOMP slipped 0.28%, to close at 3,028.92. Nikkei 225 declined 0.40%, to finish at 38,720.47. STI climbed 0.52%, to close at 3,324.53.

Wall Street closed on a mixed note as sentiment remained cautious due to uncertainty over interest rate outlook. The DJIA slid 0.17%, to end at 38,647.10. Nasdaq advanced 0.34%, to close at 17,667.56. S&P500 added 0.23%, to finish at 5,433.74.

News For The Day

Solarvest buys office space for RM48.73m

Solarvest Holdings is buying four levels of office space with 200 parking bays and a rooftop retail unit in the Solarvest Tower, which is currently under construction, from Chin Hin Group Property. The purchase costs Solarvest RM48.73m cash. The transaction is deemed a related party transaction as the duo have common shareholders. -The Edge Markets

TH Plantations JV with UEM to develop biogas power plant

TH Plantations is teaming up with UEM Lestra, a wholly owned unit of UEM Group, to develop a 1.2 megawatt (MW) biogas power plant in Kluang, Johor. The project will be carried out through a joint venture between its wholly owned unit THP Applications & Services SB, and UEM Lestra's subsidiary, Cenergi RE SB. TH Plantations, the plantation arm of Lembaga Tabung Haji, is set to begin operations in 2026 and will generate enough electricity to power up to 1,500 homes annually. -The Edge Markets

Apollo’s 4Q net profit down 12%

Apollo Food Holdings’ 4QFY4/24 net profit fell 11.85% YoY to RM5.998m from RM6.8m, due to higher operating expenses. Revenue declined 5.03% YoY to RM57.23m from RM60.27m amid reduced export sales. No dividends were declared during the quarter. -The Edge Markets

Tex Cycle to acquire wastewater mgmt co for RM55m cash

Tex Cycle Technology (M) is acquiring Meridian World SB, which specialises in wastewater and air pollution control, for RM55m in cash. The company expects to sign a definitive agreement within the next 60 days. The proposed acquisition allows Tex Cycle to expand its product and service offerings. Further, the addition of Meridian World will also expand Tex Cycle’s geographical reach to the northern region of peninsular Malaysia. – The Edge Markets

Sunview secures solar project from Uzbekistan

Sunview Group’s wholly-owned subsidiary, Fabulous Sunview SB has inked a development and cooperation agreement with Uzbekistan’s Ministry of Energy to develop two large-scale solar photovoltaic (PV) plants and battery energy storage systems (BESS) in Uzbekistan. Sunview‘s unit is responsible for the design, engineering, procurement, and construction of a 400 megawatt of alternating current (MWac) solar PV plant with a 100 megawatt (MW)/200 megawatt hour (MWh) BESS in the Andijan district. It also will develop a 200 MWac solar PV plant with a 50MW/100MWh BESS in the Fergana district. -The Star

Our Thoughts

It was another mixed day on Wall Street. While both the Nasdaq and S&P 500 continue to chart record highs as sentiment remains very much in tune to recent weakness in May’s inflation data, the DJIA ended lower. Despite the Federal Reserve hinting of possibly only one rate adjustment this tear, traders are optimistic that if prevailing CPI data stay subdued, the Fed may adjust rates by more than once this year. Meanwhile, the US 10- year yield slid to 4.248% from 4.402% at beginning June. Over in Hong Kong, the HSI rebounded to above the 18,000 level amid the US muted inflationary figure coupled with the EU recent imposition of tariff on Chinese EVs which many deemed as manageable and not excessive. Back home, the FBM KLCI pared earlier gains to close marginally higher following some late profit taking activities, Nonetheless, we believe accumulation of stocks to continue. We notice consensus had upgraded earnings growth for 2025 and the benchmark index’s prospect for 2024/25, thus we have our 2024 target at 1,730 premised on 16.5x market PER from 1,660 previously. For today, we expect the FBM KLCI to trend between the 1,610-1,620 range.

Source: Rakuten Research - 14 Jun 2024

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