Review & Outlook

The local market traded sideways on Tuesday, with technology stocks buoyed by rebound in global tech stocks while the broader market was mixed on concerns over China's economy and a hawkish US central bank. The FBM KLCI was up 0.96 points to 1,451.53, after moving within early low of 1,449.19 and high of 1,456.4, as losers edged gainers 490 to 432 on flat turnover of 3.31bn shares worth RM1.93bn.

Stocks should stay range bound pending more significant domestic leads, and as caution over China's potential measures to cushion its slowing economy and elevated US interest rates capping upside bias. On the index, immediate chart supports are from the recent low of 1,433, then 1420/ 1,400, while resistance will be at the recent 1,464 high and 1,470, with next upside hurdle from the 1,490/1,500 levels.

Supermax is still base building above the lower Bollinger band (79sen), pending convincing breakout above the 100-day ma (86sen) to aim for key resistance areas near 93sen and RM1.03, while better chart supports are at 75sen and 70sen. Likewise, Top Glove need to climb above the 100- day ma (98sen) to boost upside momentum towards tougher hurdles at RM1.10 and RM1.25, while downside is cushioned by the lower Bollinger band (78sen) and 70sen.

News Bites

• Bank Negara Malaysia's international reserves stood at US$112.2bn as at Aug 15, 2023, a 0.62% decline from US$112.9bn recorded as at endJuly.

• The New Industrial Master Plan 2030 is set to be presented to the Cabinet today for approval, said Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz.

• The High Court granted judicial review application of Tenaga Nasional Bhd to set aside RM4.0bn in tax assessment for the years 2015 to 2017.

• MBSB Bank Bhd is suing Country Heights Holdings Bhd, following its default on the payment of Islamic term financing facilities totalling RM89.7mn, to recover the sum owed.

• Iris Corporation Bhd has written to the Home Ministry to dispute the "invalid and unlawful" termination of the group's contract for the National Integrated Immigration System.

• Ecoscience International Bhd has proposed a private placement to raise RM11.2mn, as well as the issuance of free warrants.

• Magna Prima Bhd has inked a sale and purchase agreement to acquire the remaining 30.0% stake in Magna Ecocity Sdn Bhd for a cash consideration of RM45.6mn.

• OpenSys (M) Bhd is acquiring 8 offices at Pinnacle Petaling Jaya, Selangor, from JH Yong Holding Sdn Bhd for RM10.5mn to support its growing business.

• Privasia Technology Bhd has entered into an IT network, security and internet outsourcing and managed services contract with Westports Malaysia Sdn Bhd worth RM20.7mn.

• Star Media Group Bhd's 2QFY23 net profit halved 56.3% YoY to RM0.8mn while revenue advanced 7.7% YoY to RM58.0mn.

• Matrix Concepts Holdings Bhd's net profit for the 1QFY24 rose 37.3% YoY to RM64.6mn as it benefitted from improved speed of construction activity with labour shortage issues resolved.

• TMC Life Sciences Bhd's 4QFY23 net profit dropped 43.6% YoY to RM13.3mn.

• Sarawak Plantation Bhd's 2QFY23 net profit fell 45.0% YoY to RM16.6mn and revenue declined 38.5% YoY to RM127.4mn on partly offset by a gain on fair value changes in biological assets of RM4.6mn.

• Solarvest Holdings Bhd's net profit rose by 56.5% YoY to RM6.7mn for 1QFY24 while quarterly revenue soared 172.3% YoY to RM143.4mn thanks to higher revenue contributions from progress of Large Scale Solar 4 projects.

• Pekat Group Bhd's 2QFY23 net profit rose 225.0% YoY to RM3.5mn while revenue surged by 40.8% YoY to RM59.5mn due to the execution of a large scale solar project in the Batang Padang district in Perak.

• Chin Hin Group Property Bhd saw its net profit risen 91 times to RM5.8mn in 2QFY23 due to higher work progress of the construction projects.

• S&P Global Ratings lowered grades for some US financial stocks, noting the impact of higher interest rates and deposit moves across the industry.

Source: TA Research - 23 Aug 2023