Review & Outlook

The local benchmark rose on Tuesday, aided by mild bargain hunting interest in key banking, plantation and utility heavyweights ahead of this weekend's highly anticipated state elections. The FBM KLCI added 5.19 points to close at 1,451, off an early low of 1,441.63 and high of 1,452.47, as gainers led losers 437 to 389 on turnover of 3.17bn shares worth RM1.71bn.

Stocks should stay mostly range bound ahead of this weekend's closely watched state elections, with the weak trade numbers from China and pending inflation data from the US and China to check investor commitments. Immediate index resistance will be last week's high of 1,464, with 1,470, and the 1,490/1,500 level acting as tougher upside hurdles. Immediate support cushioning downside will be last week's low of 1,433, with stronger supports seen at 1,420 and 1,400.

Maybank likely to sustain its long-term uptrend and overcome the upper Bollinger band (RM9.08) and aim for the 123.6%FP (RM9.18), 138.2%FP (RM9.43) and 150%FP (RM9.62) ahead, with uptrend support from the rising 100-day ma (RM8.68) and 200-day ma (RM8.53) cushioning downside. Public Bank will need to climb above the 61.8%FR (RM4.23) to boost upside momentum and challenge the 76.4%FR (RM4.38) and 4/4/ 22 peak (RM4.60), while key retracement supports from the 38.2%FR (RM4.00) and 23.6%FR (RM3.86) cushion downside.

News Bites

• Malaysia's Industrial Production Index fell 2.2% YoY in June 2023, attributed to contraction in the manufacturing and mining sectors.

• Sales value of Malaysia's manufacturing sector declined of 4% YoY to RM147.4bn in June 2023 after recording a growth of 3.3% in the preceding month.

• Sime Darby Property Bhd is currently working with the government to find a suitable mechanism and solution to undertake a rooftop solar pilot project in its upcoming City of Elmina development in Shah Alam, Selangor.

• UOB Malaysia has announced a tie-up with Petronas Dagangan Bhd and its unit, Petronas Lubricants Marketing (Malaysia) Sdn Bhd to provide end-to-end financing to more than 1,000 dealers and distributors.

• KLCC Property Holdings Bhd has denied a Bloomberg news article listing it as a potential buyer of a stake in an office tower in Dubai's financial district.

• Pertama Digital Bhd is seeking a 12-month extension of time until Aug 9, 2024 to submit its regularisation plan to the relevant authorities.

• Pos Malaysia Bhd has introduced Pos Raudhah, a subscription package providing coverage for 24-hour funeral management or cash assistance.

• Barakah Offshore Petroleum Bhd has bagged a contract from Brunei Shell Petroleum Co Sdn Bhd for the SPM2 replacement project at an undisclosed value.

• Texchem Resources Bhd signed a Letter of Intent with CellSource Co Ltd to establish a joint venture to introduce the latter's platelet-derived factor concentrate freeze-dry processing service to medical institutions in Malaysia.

• Hengyuan Refining Company Bhd has appointed Zulhazmi Mohamad as acting chief executive officer effective on 8 August 2023.

• EP Manufacturing Bhd has signed a collaboration agreement with Grabcar Sdn Bhd and Blueshark Ecosystem Sdn Bhd to form a working relationship and jointly explore business opportunities.

• Bioalpha Holdings Bhd's founder, chief executive officer and managing director Hon Tian Kok @ William has ceased to be a substantial shareholder in BTM Resources Bhd after disposing of 35.5mn shares or a 2.8% stake.

• Pestech International Bhd's executive director Lim Peir Shenq has retracted his letter of resignation after it was announced on Bursa Malaysia.

• Sunview Group Bhd said two of its subsidiaries have been selected to be solar power producers under the Corporate Green Power Programme, with a combined allocated export capacity of nearly 60 megawatts.

• Lion Industries Corporation Bhd has scrapped its plan to acquire 80 acres of sub-divided leasehold agriculture land in Sepang for RM23.0mn.

• China's July exports plunged 14.5% YoY in dollar terms, the worst decline since February 2020, while imports contracted 12.4% YoY.

• Ratings agency Moody's cut the ratings of 10 U.S. banks by one notch and placed some banking giants on review for potential downgrades.

Source: TA Research - 9 Aug 2023