Previous Day Highlights

FBM KLCI closed lower due to broad global equity sell- offs. The benchmark index down 0.57% or 9.30 pts to close at 1,632.23. Majority of sectors were negative with property (-1.2%), construction (-1.0%), and technology (- 0.9%) leading the losses; while gainers were seen in telecommunications (+0.5%), and REIT (+0.0%). Market breadth was negative with 712 losers against 312 gainers. Total volume stood at 2.7bn shares valued at RM2.3bn.

Major regional indices trended mixed. HSI declined 1.30%, to end at 20,489.62. SHCOMP dropped 0.68%, to close at 3,280.26. Nikkei 225 up 0.10%, to finish at 38,143.29. STI rose 0.12%, to close at 3,604.95. Meanwhile, the rest of Asia finished mostly lower.

Wall Street ended mixed following mixed earnings. The DJIA dropped 0.33%, to end at 42,374.36. Nasdaq up 0.76%, to close at 18,415.49. S&P500 added 0.21%, to finish at 5,809.87.

News For The Day

RM1bn KL Sentral redevelopment to begin next year

The redevelopment of the Kuala Lumpur Sentral (KL Sentral), a pivotal transport hub connecting various modes of transportation, is expected to commence next year. Developer Malaysian Resources Corp (MRCB) and the Public-Private Partnership Unit are currently underway, focusing on finalising the terms of privatisation for the redevelopment project. The redevelopment is a public-private partnership (PPP) initiative, thus the entire cost will be covered by the developer. - The Straits Times

MKS Instruments Invests US$100bn in Penang Super Centre

MKS Instruments Inc (MKS), a global technology solutions provider, is investing US$100bn to build a super centre factory in Penang to support wafer fabrication equipment production, both regionally and globally. The factory will be built in three phases, with the first phase scheduled for completion in the first half of 2026. - The Star

Cuckoo Malaysia files for Main Market IPO

Cuckoo International (MAL), the local unit of South Korean appliance maker, has filed for an initial public offering (IPO) on the Main Market of Bursa Malaysia to raise funds for expansion. The listing would offer up to 25.5% stake in the company that sells and rents out appliances ranging from water purifiers to treadmills. Proceeds from the public issue of 143.3m shares will also be used to part-repay bank borrowings, fund expansion of its retail store network, and finance growth of its Singapore operations. - The Edge Market

ViTrox’s 3Q net profit down 33%

ViTrox Corp’s 3QFY24 net profit fall 32.5% YoY to RM22.5m amid a weak US dollar, which led to a notable unfavourable foreign exchange loss. Despite the prolonged global economic recovery, the group remains cautiously optimistic about its prospects for 4QFY24, amid currency fluctuations and intense pricing competition. - The Edge Marker

Luxchem’s 3Q net profit down 26%

Plastic material and resin manufacturer Luxchem Corp’s 3QFY24 net profitfell by more than 26% YoY to RM6.7m, mainly due to higher administrative expenses. Luxchem warned that the group’s performance could be affected by several key challenges, including US dollar/ringgit exchange rates, fluctuations in raw material prices, the demand and supply situation for raw materials, stiff competition, and ongoing global geopolitical conflicts. - The Edge Market

Our Thoughts

Wall Street ended mixed after corporate earnings showed varying performances. The DJIA slipped 0.33% amid disappointing earnings and the prolonged Boeing strike. Tesla’s earnings boost lifted the Nasdaq by 0.76% and the S&P 500 by 0.21%, while the 10-year Treasury yield fell to 4.21%. Across Asia, stocks ended mostly lower, pressured by global equity sell-offs linked to rising U.S. Treasury yields. Concerns over the contentious US election weighed heavily. In Hong Kong, the HSI fell more than 270 points, as tech stocks saw sharp declines while some investors locked in gains from recent rallies. Regional weakness led the FBM KLCI to close lower and we reckon this presents a buying opportunity for bargain hunters. As the index approaches oversold levels, we expect stock accumulation on dips and foresee a rebound, with the index trending between 1,630-1,640 today.

Source: Rakuten Research - 25 Oct 2024

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