Previous Day Highlights

FBM KLCI closed lower amid some profit taking activities. The benchmark index was down 0.32% or 5.42 pts to close at 1,664.82. Majority of sectors were negative with technology (-3.3%), utilities (-1.5%), and energy (-1.1%) leading the losses; while gainers were seen in transportation (+0.4%), and health care (+0.4%). Market breadth was negative with 796 losers against 323 gainers. Total volume stood at 3.3bn shares valued at RM3.42bn.

Major regional indices trended mixed. HSI declined 0.07%, to end at 17,444.30. SHCOMP increased 0.14%, to close at 2,788.31. Nikkei 225 eased 1.05%, to finish at 36,657.09. STI rose 0.50%, to close at 3,458.66.

Wall Street closed mixed due to a weak latest labour data. The DJIA dropped 0.54%, to end at 40,755.75. Nasdaq rose 0.25%, to close at 17,127.66. S&P500 eased 0.30%, to finish at 5,503.41.

News For The Day

Petronas 1HFY24 profit down by 19.4%

Petroliam Nasional profit after tax (PAT) for the 1HFY24 fell 19.4% YoY to RM32.4bn dragged by its gas segment. The impact from foreign exchange, which was partially offset by lower average realised prices, especially for liquefied natural gas (LNG) in tandem with declining benchmark prices. Petronas also achieved first hydrocarbon production for 5 projects in Malaysia and two in South Sudan, as well as one exploration discovery in Suriname. – The Edge Markets

PPB optimistic on 2HFY24 outlook amid stronger ringgits

PPB Group is optimistic about its 2HFY24 outlook, saying that the strengthening of the ringgit against the US dollar could lead to higher consumer spending and reduced raw materials cost. Stronger ringgit is favourable to PBB’s conglomerate’s procurement of raw materials, which are mostly imported. PPB said its property division is completing the acquisition of 3.91 acres of land in Kwasa Damansara for the development of a low- density condominium project. For the next 5 years, the group has earmarked a total of RM787m for capital expenditures. – The Edge Markets Binastra unit secures RM283.3m building job in KL Binastra Corporation unit has received a RM283.3m contract for the main building works of a major residential development in Taman Desa, Kuala Lumpur from Kaisar Maxim. With RM1.9bn new contracts secured to date, the group are confident to achieve its full-year target of RM3.0bn. As of 5 Sept 2024, Binastra said its outstanding order book value amounts to RM2.8bn is expected to provide financial visibility in the next 4 years. - The Star

Inta Bina secures RM96.6m construction job

Inta Bina Group has secured another construction contract from Sime Darby Property worth RM96.6m to undertake main building and construction works for a 37-storey serviced apartment project in Putra Heights, Selangor. This latest win marks the sixth construction project secured by Inta Bina this year, bringing its total orderbook of RM1.16bn. - The Edge Markets

Jentayu receives approval for RM2.8bn project

Jentayu has received a letter of notification from the Energy Commission of Sabah (ECOS) for the RM2.8bn Project Oriole, a run-of-river hydro plant slated for operations in 2028. Jentayu is also acquiring another hydro power project in Tenom, comprising of two plants with capacity of 40MW named Telekosang Hydro 1 and 2. - The Edge Markets

Our Thoughts

Wall Street ended mixed as sentiment turned cautious as the latest weak job report is giving mixed signals over the US economic health. As a result, the DJIA declined by 219 points while the Nasdaq added 43 points with the US 10- year yield easing marginally to 3.725%. In Hong Kong, the HSI closed slightly lower as traders were sidelined from the lack of fresh catalysts ahead of the Fed rate cut later this month. Energy stocks continued to drag the broader market in line with the weak crude oil prices. Back home, the FBM KLCI closed lower, attributed to the emergence of sellers in the afternoon session amid a mixed scenario regionally. While we believe fundamentals of the local bourse remains intact, externalities still play a pivotal role in dictating the market’s direction. Thus, in view of the mixed Wall Street performance we believe market undertone to stay boring and expect the index to hover within the 1,660-1,670 range today.

Source: Rakuten Research - 6 Sep 2024

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