TA Sector Research

Daily Market Commentary - 01 September 2023

Publish date: Fri, 01 Sep 2023, 09:42 AM

Review & Outlook

Profit-taking emerged to reverse early gains Wednesday, as investors reduced trading commitments ahead of the Merdeka Day holiday break, but the technology (+1.4%), property (+1.1%) and construction (+0.9%) sectors rose to outperformed the broader market. The FBM KLCI lost 2.5 points to end at the day's low of 1,451.94, off an intra-day high of 1,462.8, as gainers equal losers at 499 on robust trade totaling 4.9bn shares worth RM4.75bn.

Property and construction stocks should continue to shine in the nearterm amid keen anticipation for announcements on key infrastructure projects or stimulus measures to boost the sector, while on the external front, investors will be awaiting the closely watched monthly U.S. jobs data by the end of the week for clues on the health of the US economy. Immediate index resistance remains at the recent 1,464 high and 1,470, with next hurdle from the 1,490/1,500 level, while immediate support stays at the recent low of 1,433, then 1420/1,400.

Maybank will need convincing breakout above the 123.6%FP (RM9.18) to fuel upside momentum and aim for the 138.2%FP (RM9.43), 150%FP (RM9.62) and 161.8%FP (RM9.82) going forward, while downside is capped by uptrend support from the 100-day ma (RM8.77). RHB Bank needs to climb above the upper Bollinger band (RM5.74) to sustain upward momentum towards the 123.6%FP (RM5.90) and 138.2%FP (RM6.06), while the 100-day ma (RM5.50) also provide strong uptrend support.

News Bites

  • Malaysia's international reserve assets amounted to US$112.94bn as at end-July 2023, while other foreign currency assets stood at US$1.7mn, said Bank Negara Malaysia.
  • Malaysia's manufacturing industry operated at a lower capacity utilisation of 78.2% in the 2Q23, versus 79.0% in the same period last year.
  • Kerjaya Prospek Group Bhd has secured a RM125.0mn contract from a subsidiary of UEM Sunrise Bhd for a proposed phase two development project at Taman Equine in Bandar Putra Permai, Selangor.
  • Westports Malaysia Sdn Bhd has received a letter from the Port Klang Authority disclosing that the proposed expansion of the container terminals has been presented to the Cabinet on 25 July 2023.
  • Matrix Concepts Bhd has secured shareholders' approval to acquire a 1,382-acre tract in the Malaysian Vision Valley 2.0 development corridor for RM460.0mn.
  • Ekovest Bhd has proposed a private placement of up to 269.6mn shares or 10.0% of the total number of its issued shares, which will help to raise funds for the construction of the Rapid Transit System Link project.
  • Sunview Group Bhd has planned a private placement to raise an estimated RM39.3mn to fund its engineering, procurement, construction and commissioning projects.
  • Comintel Corporation Bhd has accepted a letter of award worth RM161.3mn for construction and completion of main building works and infrastructure works from Exsim Jalil Link Sdn Bhd.
  • Bursa Securities has rejected Top Builders Capital Bhd's revised request for an extension of time to submit its regularisation plan by 29 December 2023 to the relevant authorities.
  • Chin Hin Group Bhd posted a 43.2% YoY drop in its net profit to RM21.9mn for the 2QFY23, amid a lower fair value gain on other investment.
  • Malaysia Building Society Bhd reported a net profit of RM83.7mn for the 2QFY23, a decline of 41.2% YoY because other operating expenses rose while net income excluding expected credit losses decreased.
  • Malaysian Resources Corp Bhd's net profit fell 22.9% YoY to RM10.9mn for the 2QFY23 mainly due to the completion of 3 major infrastructure construction projects in late 2022 and the completion of 2 major property development projects in the 1HFY23.
  • Media Prima Bhd clocked in a net profit of RM8.8mn and a revenue of RM223.0mn for 6QFY23.
  • China's official purchasing managers' index rose to 49.7 from 49.3 in July, staying below the 50-point level, demarcating contraction from expansion.
  • The US personal consumption expenditures increased 3.3% YoY in July, after advancing 3.0% in June, while the core PCE price index increased 4.2% YoY after rising 4.1% in June.
  • The US GDP rose at a 2.1% annualised rate last quarter, the government said in its second estimate of GDP for the April-June period. That was revised down from the 2.4%.

Source: TA Research - 1 Sept 2023

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