Previous Day Highlights

FBM KLCI closed marginally higher despite the weak regional performance. The benchmark index advanced 0.17% or 2.74 pts to close at 1,636.55. Gainers were seen in plantation (+1.74%), telecommunications (+0.69%), and energy(+0.34%); while losers were seen in property (- 1.14%), technology (-0.90%), and health care (-0.81%). However, market breadth was negative with 736 losers against 445 gainers. Total volume stood at 4.43bn shares valued at RM3.27bn.

Major regional indices trended broadly lower amid the cautious sentiment. HSI slumped 2.03%, to end at 17,417.68. SHCOMP increased 0.17%, to close at 2,982.31. Nikkei 225 eased 0.16%, to finish at 40,063.79. STI dropped 0.68%, to close at 3,447.56.

Wall Street ended in negative territory, hitting the heavyweights amid some rotational plays. The DJIA fell by 0.93%, to end at 40,287.53. Nasdaq lost 0.81%, to close at 17,726.94. S&P500 declined 0.71%, to finish at 5,505.00.

News For The Day

SunCon unit awarded RM418m sub-contract for DC project

Sunway Construction Group, which in March won a RM747.8m contract from a US-based multinational technology corporation for the construction of a data centre in Selangor, announced the award of a sub-contract relating to the project worth RM417.8m. The sub-contract for the construction of the project's mechanical and electrical system was awarded to Sunway Engie DC SB, a joint venture company between Sunway Engineering SB (70% stake) and Engie Services Malaysia SB (30% stake). The sub-contract work is expected to be completed by 2Q27.-The Edge Markets

Genting Plantations to acquire lands for RM593m

Genting Plantations, in which Genting owns a 55.4% stake, is planning to buy two plots of land in Indonesia for RM593m, for property development. The plots, measuring 152ha, are located in Sentul City, in the Bogor Regency of the West Java Province in Jakarta. Its indirect subsidiaries had inked separate sale and purchase agreements with three vendors — PT Sentul City Tbk, PT Aftanesia Raya and PT Primatama Cahaya Sentosa to buy the plots. -The Edge Markets

EG Industries secures 5G photonics related US$117m

EG Industries, an electronics manufacturing services provider, has secured a confirmed purchase order valued at US$117m (RM545.67m) for 5G photonics related products. Its wholly-owned subsidiary SMT Technologies SB secured the PO from an unnamed existing key customer. The group added that the PO is expected to be fulfilled in tranches over the next 12 months. -The Edge Markets

Fima Corp bags RM94m contract from Education Ministry

Fima Corp has secured a RM93.92m contract from the Ministry of Education to print and supply confidential documents to the ministry. The group said the two-year contract was awarded to its wholly-owned subsidiary Percetakan Keselamatan Nasional SB. -The Edge Markets

MCE secures RM19.6m contract from Perodua for EV

MCE Holdings’ wholly-owned subsidiary, Multi-Code Electronics Industries (M), has secured a RM19.6m contract from Perusahaan Otomobil Kedua SB (Perodua), to supply Perodua with various electronic and mechatronic components for Perodua’s new electric vehicle (EV). The contract spans 3 years, commencing in 2QFY26.- The Star

Our Thoughts

Wall Street ended the week on a weak note as all 3 major indices slumped amid the rotation into smaller cap stocks. Although trading was not affected by the global IT shutdown, the main culprit Crowdstrike tumbled 11.1%. As such, the DJIA lost 377 points while the Nasdaq declined by 144 points with the US 10-year yield climbed to 4.242%. Over in Hong Kong, the HSI dipped by a massive 360 points as sentiment remained downbeat over the underwhelming China’s economic performance and the lack of details of policy to spur growth. Back home, despite the regional turbulence, the FBM KLCI closed on yet another YTD high as buying momentum remains very much intact amid some intermittent profit taking activities. However, we noticed daily volume traded had declined significantly to below the 4.5bn shares level on Friday illustrating that market undertone was still cautious. Notwithstanding the drag on Wall Street, we believe trading on the local bourse to stay positive as ongoing rotation by foreign funds may see some spillover effect into the region namely Malaysia. Thus, we expect the index to trend within the 1,630-1,640 range today.

Source: Rakuten Research - 22 Jul 2024

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