TA Sector Research

Daily Market Commentary - 11 Dec 2023

Publish date: Mon, 11 Dec 2023, 09:40 AM

Review & Outlook

Given the weak trading sessions witnessed on the local stock market for the whole of last week, as the positive tone on foreign markets sparked by hopes the US Federal Reserve is done raising interest rates and in fact may pivot to cut rates sometime next year failed to spillover, there could be further downward bias for this coming week. Also, the absence of strong follow-through buying momentum and negative market breadth implies that further profit-taking could drag stocks lower, unless local positive catalysts emerge. On the other hand, due to spreading optimism the US economy could be in for a soft landing following the resilient November jobs data and consumer sentiment numbers, bargain hunters should return to cushion downside.

On the index, better chart supports are at 1,430, and then 1,400/1,390, while the end June low of 1,370 will act as crucial support. Immediate resistance remains at 1,465/1,470, with the 1,490/1,500 area acting as tougher upside hurdle.

As for stocks picks for the week, key banking, construction, oil & gas and utility counters such as Public Bank, Gamuda, Bumi Armada, Dialog, DNEX, Sime Darby and Tenaga should manage to attract bargain hunters looking to buy on weakness for year-end recovery upside.

News Bites

  • The number of unemployed persons in Malaysia in October 2023 decreased 0.5% to 570,999 persons, while the unemployment rate remained at 3.4%.
  • YTL Power International Bhd has confirmed that it is going to collaborate with Nvidia Corp to build an artificial intelligence infrastructure that will be powered by the US-based chip giant's technology.
  • Westports Holdings Bhd has entered into a third supplemental privatisation agreement with the government and Port Klang Authority for the proposed expansion of its container terminals.
  • Malayan Banking Bhd has appointed Alvin Lee Han Eng as its country Chief Executive Officer, CEO of Maybank Singapore Ltd and CEO of Maybank Singapore branch, effective 1 January 2024.
  • MyEG Services Bhd's blockchain platform Zetrix has introduced its latest digital qualification platform that offers Chinese citizens the option to digitise their identification card and driving licence on the blockchain, which can be presented when travelling abroad.
  • Supermax Corporation Bhd announced that its first glove manufacturing facility in the US is nearing completion, with the group having fulfilled and complied with various regulatory requirements, including permits, to operate the plant in Brazoria County, Texas.
  • Mah Sing Group Bhd will be developing M Azura, a new transit-oriented development on 4 acres of prime land in Setapak, Kuala Lumpur, with an estimated gross development value of RM508mn.
  • Chin Hin Group Property Bhd is acquiring a freehold plot in Penang measuring about 1.2acres from Ivory Properties Group Bhd for RM40.0mn to build a multi-storey serviced residence.
  • Axis Real Estate Investment Trust is acquiring a hypermarket in Temerloh, Pahang for RM25.8mn from Amal Mewah Development Sdn Bhd.
  • Pecca Group Bhd is banking on its aviation segment to unlock its next phase of growth, according to Managing Director Datuk Kelvin Teoh Hwa Cheng.
  • Aeon Credit Service (M) Bhd has fully redeemed its RM100.0mn sukuk in nominal value that was callable last Friday.
  • Apex Equity Holdings Bhd said the Securities Commission Malaysia has withdrawn all 'additional conditions and reporting requirements' that it imposed on the group's stockbroking arm Apex Securities Bhd, with immediate effect.
  • MSM Malaysia Holdings Bhd has extended the garden leave of its Chief Financial Officer Mazatul 'Aini Shahar Abdul Malek Shahar from 15 December 2023 to 15 January 2024, or until further notice from the board.
  • EcoFirst Consolidated Bhd, which is facing a RM20.0mn lawsuit for withdrawing a RM404.4mn contract it had issued to Kerjaya Prospek Group Bhd, said the group will be contesting the matter.
  • China's consumer price index fell 0.5% YoY last month stoking deflation fears.
  • The US unemployment rate fell to 3.7% and nonfarm payrolls increased by 199,000 jobs last month after rising by an unrevised 150,000 in October.

Source: TA Research - 11 Dec 2023

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