TA Sector Research

Daily Market Commentary - 6 Nov 2023

Publish date: Mon, 06 Nov 2023, 08:58 AM

Review & Outlook

Last Friday's gap-up on the FBM KLCI to finish at a six-week high looks promising, as technical momentum has turned positive substantially, which should aid further gains when robust buying momentum return to support uptrend resumption. A significant recovery in global risk sentiment is also crucial to support further upside momentum ahead, with a lessening in geopolitical tensions in the Middle East and further easing of US Treasury yields from multi-year highs to reduce concerns interest rates need to stay high for a prolonged period.

On the index, immediate resistance is adjusted upwards to 1,465/1,470, while the 1,490/1,500 area will act as tougher upside hurdle. Immediate support is also revised higher to 1,430, with 1,400/1,390, and the end June low of 1,370 acting as crucial support.

On stocks to look forward to this week, key telcos, banking and utility related blue chips like Axiata, CelcomDigi, Maxis, TM, Maybank, RHB Bank, Sime Darby and Tenaga should attract renewed buying interest from investors anticipating uptrend resumption after the recent brief consolidation phase.

News Bites

  • RHB Bank Bhd and Axiata Group Bhd's 75.4% unit Boost Holdings Bhd have raised the paid-up capital of its 40:60 digital bank joint venture Boost Bhd by RM85mn to continue meeting the minimum capital funds requirement of RM100mn unimpaired by losses.
  • CIMB Group Holdings Bhd has refuted allegations circulating on WhatsApp on Friday that it is undertaking a major retrenchment exercise in its wholesale banking business.
  • Yinson Holdings Bhd's 285MW Nokh Solar Park in Rajasthan, India commenced operation on 3 Nov 2023.
  • MyEG Services Bhd's blockchain platform Zetrix has partnered with Chinese banks, starting with the Bank of China, to initiate a pilot project that offers supply chain financing products for international importers and exporters.
  • The Armed Forces Fund Board's efforts to implement the possible general offer involving Boustead Plantations Bhd remain ongoing, subject to obtaining the requisite approvals.
  • Infomina Bhd has secured a three-year contract worth approximately RM49.4mn from the Home Ministry to provide maintenance and support services to the core business system of the National Registration Department.
  • MSM Malaysia Holdings Bhd said its chief financial officer Dr Mazatul 'Aini Shahar Abdul Malek Shahar is on garden leave from 20 October to 15 December 2023, or until further notice from the board.
  • Indonesia's highest court has dismissed the appeal by TDM Bhd's subsidiary against the republic's Ministry of Environment and Forestry in relation to a fire incident in 2019 at its land in West Kalimantan province.
  • Boustead Heavy Industries Corp Bhd said a winding-up petition served on its associate company Boustead Naval Shipyard Sdn Bhd, for a RM56.0mn claim, had finally been withdrawn.
  • EA Technique (M) Bhd has bagged a RM6.4mn contract extension from Northport (Malaysia) Bhd to operate and charter two Z-Peller harbour tug boats.
  • Highbase Strategic Sdn Bhd, an oil and gas maintenance services provider, is expected to contribute approximately 30% to 35% of GFM Services Bhd's total revenue and bottom line from FY24.
  • Medical device company UMediC Group Bhd plans to spend its unutilised IPO proceeds of RM7.9mn on developing its marketing distribution and manufacturing segments.
  • Avaland Bhd's Casa Embun apartment development in its 417-acre Cybersouth township in Dengkil saw its first phase 70% taken up since the launch in January.
  • Paragon Globe Bhd has proposed to acquire a piece of freehold land in Johor Bahru for RM16.5mn.
  • Bursa Securities has denied financially distressed oil and gas company Serba Dinamik Holdings Bhd's request for an extension to release its FY23 annual report.
  • China's Caixin/S&P Global services purchasing managers' index rose to 50.4 in October from September's nine-month low of 50.2.
  • The US non-farm payrolls increased 150,000 last month, following a downwardly revised 297,000 in September.
  • European Central Bank president Christine Lagarde said that slowing inflation is "certainly our forecast" and that the institution is determined to return prices to its 2% target by 2025.

Source: TA Research - 6 Nov 2023

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