Previous Day Highlights

FBM KLCI closed marginally lower as trading remained lackluster due to cautious sentiment preceding the release of US inflation data. The benchmark index was down 0.14% or 2.30 pts to 1,612.88. Majority of sectors were positive with energy (+0.8%), transportation (+0.8%), and property (+0.5%), leading the gains; while losers were seen in technology (-0.4%), and consumer (- 0.3%). Market breadth was negative with 569 losers against 455 gainers. Total volume stood at 3.83bn shares valued at RM2.7bn.

Major regional indices trended mixed. HSI added 0.10%, to end at 17,021.31. SHCOMP advanced 0.14%, to close at 2,890.90. Nikkei 225 declined 0.53%, to finish at 37,667.41. STI slid 0.12%, to close at 3,426.47.

Wall Street closed higher, spurred by optimism over potential rate cuts amid a decent key inflation data. The DJIA soared 1.64%, to end at 40,589.34. Nasdaq mounted 1.03%, to close at 17,357.88. S&P500 jumped 1.11%, to finish at 5,459.10.

News For The Day

Westports’ 2Q net profit up 5%, declares 8.89 sen dividend

Westports Holdings’ 2QFY12/24 net profit rose 4.61% YoY to RM203.75m from RM194.76m, due to lower operating expenses. Revenue inched up 1.9% YoY to RM552.99m from RM542.64m, attributed to an increase in container revenue. The port operator declared its first interim dividend of 8.89 sen per share, to be paid on Aug 21. -The Edge Markets

AirAsia X to take over Capital A’s aviation business

AirAsia X will be acquiring Capital A's aviation business directly, and not via a new company under an internal reorganisation proposed previously, to expedite the takeover. The decision was arrived at after weighing potential benefits of the proposed internal reorganisation against time required for the implementation of the proposed internal reorganisation.-The Edge Markets

Hibiscus-Petronas in 65:35 production sharing contract

Hibiscus Petroleum’s indirect wholly owned subsidiary Hibiscus Oil & Gas Malaysia Ltd has been awarded a 65% participating interest and operatorship in a production sharing contract by Petronas. Hibiscus said the remaining participating interest is held by Petronas Carigali SB, while the effective date of the production sharing contract is July 1, 2024, with a contract duration of 24 years.-The Star

Datasonic gets RM30m contract in Indonesia

Datasonic Group has secured a RM30m contract to supply smart cards to Perum Percetakan Negara Republik Indonesia (PNRI), a unit of the Indonesian Ministry of State-Owned Enterprises. Its unit PT Datasonic Teknologi Indonesia has signed a sale and purchase agreement with PNRI to supply smart cards over a period of 1 to 3 years. The Edge Markets

Kitacon wins RM54.5m construction contract

Kumpulan Kitacon’s wholly owned subsidiary, Kitacon SB has secured a RM54.5m construction contract from Rawang Lakes SB. The contract is for the construction of 186 units of two-storey terrace houses and one unit of Tenaga Nasional substation in Bandar Tasik Puteri, Rawang, Selangor. The contract commences on August 1, 2024, and is to be completed within 20 months.-The Star

Homeritz’s 3Q net profit soars 46.37% on higher sales

Homeritz Corp’s 3QFY24 net profit surged 46.37% YoY to RM9.09m from RM6.21m, thanks to higher sales volume and the stronger US dollar. Revenue rose 63.34% YoY to RM61.88m from RM37.88m. -The Edge Markets

Our Thoughts

Wall Street surged supported by a combination of positive catalysts namely an oversold position plus June’s PCE (personal consumption expenditure) growth figure that came in within expectations. As such, the DJIA climbed 654 points while the Nasdaq rose 176 points as the US 10-year yield weakened to 4.193%. Over in Hong Kong, the HSI just managed to stay above water as sentiment remained cautious ahead of US release of the PCE data. Meanwhile, there are underlying expectations that China may come out with more easing policy to inject the ailing domestic confidence. Back home, the FBM KLCI closed slightly lower as trading was muted with investors side-lined for the US inflation data. As a result, daily volume traded last Friday declined to below the 4bn shares level. We believe last Friday’s resurgence of Wall Street will prop up buying activities on the local bourse thus expect the index to hover within the 1,615-1,625 range today. Meanwhile, the MYR strengthened to around RM4.65 level which is almost at YTD high.

Source: Rakuten Research - 29 Jul 2024

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