TA Sector Research

Daily Market Commentary - 20 September 2023

Publish date: Wed, 20 Sep 2023, 09:55 AM

Review & Outlook

Stocks stayed soft as profit-taking interest persisted Tuesday, as investors traded cautiously ahead of the start of the U.S. Federal Reserve's two-day monetary policy meeting, which will ultimately decide the interest rate direction. The KLCI ended flat at 1,457.66 after ranging between high of 1,459.00 and low of 1,454.61, as gainers beat losers 519 to 406 on steady turnover of 3.94bn shares worth RM2.13bn.

Blue chips should extend range bound trade on caution over external uncertainties, while the oil and gas related stocks continue to attract bargain hunters amid stronger Brent oil prices. Immediate overhead resistance for the index remains at 1,465, then 1,470, with the 1,490/ 1,500 area as next resistance, while immediate support cushioning downside stays at 1,440, followed by 1,433, with subsequently 1420/1,400 acting as stronger supports.

Genting Berhad shares should attract buyers looking for rebound upside from current oversold levels, with a confirmed breakout above the 200- day ma (RM4.39) to aim for the 76.4%FR (RM4.55) and RM4.70 ahead, while the 50%FR (RM3.91) strongly cushions downside. Genting Malaysia is in base building mode, pending decisive breakout above the 61.8%FR (RM2.60) to target the 76.4%FR (RM2.74) and RM2.90 going forward, with the 38.2%FR (RM2.38) cushioning downside.

News Bites

  • Malaysia's export and import figures continued to tumble in August 2023, posting a double-digit decline of -18.6% to RM115.16bn and -21.2% to RM97.85bn respectively.
  • The government may have to bear more than RM100bn in subsidies annually if the world crude oil price hits US$100 a barrel, said Economy Minister Rafizi Ramli.
  • Bursa Malaysia Bhd signed a memorandum of understanding with the Indonesia Stock Exchange and the Stock Exchange of Thailand to collectively explore establishing an inter-regional environmental, social, and governance-linked ecosystem.
  • MyEG Services Bhd said it is still finalising terms of an immigrationrelated services concession with Putrajaya, as it confirmed it had stopped accepting applications temporarily from customers on its portal since 15 September 2023.
  • YTL Hospitality REIT has entered into 3 supplemental lease agreements for rental revisions and proposed refurbishment of its 3 hotels in Kuala Lumpur, Penang and Kuantan.
  • Cypark Resources Bhd has reported the emergence of a new substantial shareholder, Chung Dao, with a 5.5% after acquiring 40mn shares on 14 September 2023.
  • Land & General Bhd allayed concerns that liquidity issues faced by joint venture partner Country Garden would have a negative spillover effect on their 167-acre township development in Semenyih that started in 2014.
  • Bursa Malaysia Securities has publicly reprimanded Dataprep Holdings Bhd and 5 of its directors for breaches of listing requirements over the IT company's reply to an unusual market activity query on its Covid-19 screening contracts in March 2021.
  • Epicon Bhd's (formerly Konsortium Transnasional Bhd) wholly-owned subsidiary Transnasional Builder Sdn Bhd has secured a structural works contract for a sum of RM34.5mn.
  • Telekom Malaysia Bhd's former chief executive officer Datuk Dr Md Khir Abdul Rahman has been appointed as an independent and nonexecutive director of sustainable energy and utilities provider Reneuco Bhd (formerly KPower Bhd).
  • Kuala Lumpur Kepong Bhd acquired an additional 1.3mn Boustead Plantations Bhd shares from the open market on Monday.
  • Scientex Packaging (Ayer Keroh) Bhd (formerly Daibochi Bhd), saw its net profit slump 98.7% YoY to RM149k in 4QFY23, from RM11.4mn a year earlier, due to higher goodwill impairment of RM22.7mn for its operations in Myanmar.
  • New US home construction dropped 11.3% to a 1.28mn annualised rate in August, the lowest level since June 2020, highlighting the toll of declining housing affordability.
  • The Organisation for Economic Co-operation and Development said the world economy would grow 3.0% and 2.7% this year and next, which was revised from previous 2.7% and 2.9% respectively.

Source: TA Research - 20 Sept 2023

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