TA Sector Research

Daily Market Commentary - 12 September 2023

Publish date: Tue, 12 Sep 2023, 09:56 AM

Review & Outlook

Bursa Malaysia shares ended softer on Monday, as profit-taking consolidation on the property, construction and oil & gas sectors prevailed given the absence of further positive domestic catalysts. The FBM KLCI ended flat at 1,455.04 (+0.09), off an early high of 1,455.56 and low of 1,450.68, as losers beat gainers 609 to 295 on muted trade totaling 2.79bn shares worth RM1.63bn.

Stocks should trade sideways with downward bias as profit-taking consolidation persist on the property and construction sectors pending positive domestic catalysts to sustain bullish momentum. The immediate index support remains at 1,440, followed by 1,433, with subsequently 1420/1,400 acting as stronger supports. Immediate overhead resistance will be at 1,465, then 1,470, with the 1,490/1,500 levels as higher resistance.

A breakout confirmation on Hartalega share price above the 50%FR (RM2.21) would fuel upside momentum towards the 61.8%FR (RM2.40) and 76.4%FR (RM2.63) ahead, while the 200-day moving average (RM1.90) should act as strong support cushion. Kossan Rubber will need sustained strength above the 50%FR (RM1.41) to enhance upside momentum and target the 61.8%FR (RM1.53) and 76.4%FR (RM1.68) going forward, while the 200-day ma (RM1.23) provides strong support platform.

News Bites

  • Malaysia's economy is on track to grow between 5.0% and 5.5% per annum for the remainder of the 12th Malaysia Plan, according to the Mid-Term Review of the 12MP report.
  • Malaysian government will spend the entire RM400bn allocations for development expenditure under the 12MP, and even increase the ceiling by RM15bn to a total of RM415bn.
  • Malaysia is expected to fully implement the targeted subsidy programme beginning next year, said Economy Minister Rafizi Ramli.
  • Malaysia's industrial production index rebounded by 0.7% YoY in July 2023, spurred by the mining and electricity sectors.
  • Malaysia palm oil stockpiles jumped 23% MoM to 2.12mn tonnes in August, according to a report by the Malaysian Palm Oil Board.
  • CIMB Group Holdings Bhd has raised its sustainable finance target to RM100bn by 2024, marking a substantial increase from its earlier target of RM60bn set in 2022 and an initial goal of RM30bn set in 2021.
  • Serba Dinamik Holdings Bhd's liquidator has set Oct 10 as the date for the meeting of contributories to provide a status update of the company's liquidation and consider the appointment of a Committee of Inspection.
  • Kuala Lumpur Kepong Bhd has entered into a letter of agreement with Boustead Holdings Bhd and the Armed Forces Fund Board to agree for the cut-off date for a strategic collaboration agreement to be Sept 22, or such other date as may be agreed in writing between them.
  • UEM Sunrise Bhd is disposing of a 4.0-acre parcel of land in Kiara Bay, Kuala Lumpur for RM85mn to repay its debt obligations and fund its working capital for new product launches.
  • Ramsay Health Care Ltd, and Malaysian conglomerate Sime Darby Bhd have shortlisted candidates for the sale of their hospital unit, which could fetch about USD1.5bn in a deal, according to people with knowledge of the matter.
  • Artroniq Bhd is going to distribute electric motor products for Indonesian firm PT Terang Dunia Internusa.
  • Globaltec Formation Bhd's indirect subsidiary has received approval to extend the exploration period for the Muralim Production Sharing Contract in Indonesia until March 29, 2025.
  • Tune Protect Group Bhd has expanded its product offering into the African market through a partnership with Nigeria's Leadway Assurance Company Ltd and Tune Protect Re.
  • Capital A Bhd CEO Tan Sri Tony Fernandes expects to see AirAsia's operations returning to pre-pandemic levels by December.
  • OCK Group Bhd has issued sukuk murabahah pursuant to its Islamic medium-term notes programme of up to RM700.0mn in nominal value over a tenure of 30 years.
  • Median one-year-ahead inflation expectations in the US rose slightly last month to 3.6% from 3.5% in July.
  • EU Commission cuts Eurozone growth forecast to 0.8% in 2023 and 1.3% in 2024, against previous forecasts of 1.1% and 1.6% respectively as Germany is in a recession.

Source: TA Research - 12 Sept 2023

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