Previous Day Highlights

FBM KLCI closed higher due to bargain hunting on heavyweight stocks. The benchmark index up 0.27% or 4.32 pts to close at 1,629.79. Majority of sectors were positive with construction (+3.5%), technology (+1.7%), and plantation (+0.6%), leading the gains; while losers were seen in health care (-2.1%), and telecommunications (- 0.9%). Market breadth was negative with 614 losers against 490 gainers. Total volume stood at 3.91bn shares valued at RM3.3bn.

Major regional indices trended mixed. HSI declined 1.22%, to end at 19,447.58. SHCOMP increased 0.71%, to close at 3,229.64. Nikkei 225 up 1.97%, to finish at 40,083.30. STI rose 0.03%, to close at 3,822.83.

Wall Street closed lower due to concerns over inflation rise. The DJIA dropped 0.42%, to end at 42,528.36. Nasdaq eased 1.89%, to close at 19,489.68. S&P500 eased 1.11%, to finish at 5,909.03.

News For The Day

Malaysia imposes 6.33%-37.44% duties on plastic imports

Malaysia imposed provisional anti-dumping duties of 6.33%- 37.44% on imports of Polyethylene Terephthalate (PET) from China and Indonesia, effective January 7, 2025. The duties, lasting up to four months, aim to protect domestic industries from harm, with a final decision due by May 6, 2025, following an investigation initiated in August 2024 based on a petition by local producer Recron (M). - New Straits Times

UUE gets RM36.5m contract extension and renewal

UUE Holdings’ unit Kum Fatt Engineering has received an extension and renewal of its contracts with Komasi Engineering, totalling RM36.5m. These are for the installation, testing and commissioning of underground cables and accessories of 33 kilovolts (kV) and 11kV Aluminium XLPE type. - The Edge Market

OCBC Malaysia ready to support Johor-SG Economic Zone

OCBC Bank (Malaysia) is committed to supporting businesses and individuals in the Johor-Singapore Special Economic Zone (JS-SEZ) with tailored financial services and onboarding solutions. Highlights include local banking and financing options, passport-free QR code clearance, and tax incentives. CEO Tan Chor Sen emphasized the bank's role in fostering economic collaboration, innovation, and Malaysia's energy transition, leveraging OCBC's extensive regional network to simplify market entry and expansion. – New Straits Times

Paragon Globe secures rights for Johor residential project

Paragon Globe (PGB) has entered into three development rights agreements with Iskandar Capital for the proposed development rights of three parcels of freehold lands in Johor Baru, totalling 63.61 acres to develop various property types on two of the plots of land, namely Plot N1-5 and Plot 2A. The group is projected to realise estimated profits of RM188.1m upon the completion. - The Edge Market

Nestcon wins RM25m contract for Senai Airport City project

Nestcon's unit, Nestcon Infra, secured a RM25m contract from Senai Airport City for earthworks and erosion control in the third phase of Senai Airport City’s 121.4-ha industrial expansion. The 18-month project begins immediately, with completion expected by July 12, 2026, providing industrial plots with infrastructure for investors. - The Star

Our Thoughts

Wall Street closed lower as the latest market data pointed to a higher-than-expected number of US job openings in November, underscoring economic resilience that might prompt the Federal Reserve to pause additional rate cuts. The Dow slide 0.42% while S&500 fell 1.11%. Profit takings in tech stocks caused the Nasdaq plunging 1.89%. The US 10- year Treasury yield rose over 7 basis points to 4.693%, after reaching an intraday peak of 4.699%, marking its highest level since April 2024. In Hong Kong, the HSI ended lower as Chinese tech stocks faced a sell-off following the US designation of dozens of Chinese firms as military-linked entities. Tencent Holdings and Contemporary Amperex Technology were among those blacklisted, highlighting deteriorating trade relations between the two largest economies, with tensions expected to escalate under President-elect Donald Trump's tariff policies. As for the local bourse, the FBM KLCI finished higher as bargain hunting activities emerged following two days of sell-off. The benchmark index is showing signs of recovery, supported by a positive EMA crossover and strong backing from local institutions. We believe the upward momentum will help the index regain its strength. For today, we expect the FBM KLCI to trade within the range of 1,625–1,635.

Source: Rakuten Research - 8 Jan 2025

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