TA Sector Research

Daily Market Commentary - 11 Jan 2024

Publish date: Thu, 11 Jan 2024, 12:09 PM

Review & Outlook

The local market fell for profit-taking correction on Wednesday, as overbought conditions and recent sharp gains encouraged investors to take profits on trading positions. The FBM KLCI lost 11.97 points to end near session lows at 1,486.86, off an opening high of 1,497.80, as losers beat gainers 588 to 359 on lower turnover of 4.97bn shares worth RM2.84bn.

Stocks should extend profit-taking consolidation, which is key to rebuild support, consolidate gains and further neutralize overbought conditions. On the index, immediate resistance will be near the 1,500 level which capped upside in Jan 2023, with next hurdle at 1,520. Immediate chart supports are at 1,480, and 1,450, with better supports at 1,440 and 1,430.

Axiata need convincing breakout above the 23.6%FR (RM2.58), matching the 200-day ma, to extend upside towards the 38.2%FR (RM2.82) and 50%FR (RM3.02) going forward, with downside cushioned by the lower Bollinger band (RM2.28). CelcomDigi will need breakout confirmation above the 123.6%FP (RM4.35) to enhance upside momentum and target the 138.2%FP (RM4.52) and 150%FP (RM4.65) ahead, while the lower Bollinger band (RM4.03) cushions downside.

News Bites

  • Malaysia's unemployment rate returned to pre-pandemic levels of 3.3% in November, with 569,000 unemployed individuals, compared with 3.4% recorded in October.
  • Prime Minister Datuk Seri Anwar Ibrahim is meeting his Singapore counterpart Lee Hsien Loong today, a meeting which can be described as another milestone in bilateral relationship, as they affirm commitments to two megaprojects.
  • Public Bank Bhd has withdrawn its lawsuit against Magma Group Bhd and Magma executive chairman Datuk Seri Ismail Farouk Abdullah, stemming from a dispute over the settlement of outstanding sums under various term loan and overdraft facilities.
  • Genting Malaysia Bhd announced that it will inject another US$100.0mn (RM464.2mn), into Empire Resorts Inc, in which it has already put in about US$624.4mn to date.
  • Sime Darby Bhd announced that it had accumulated 90.7% of UMW Holdings Bhd's shares as at 10 January 2023, paving the way for the delisting of the Toyota marque distributor.
  • FGV Holdings Bhd has reimbursed RM72.2mn to 19.7k migrant workers, in its efforts to modify the Withhold Release Order issued by the US Customs and Border Protection.
  • Hextar Capital Bhd has completed the acquisition of 49.0% stake in power industry engineering, procurement, construction and commissioning outfit Transgrid Ventures Sdn Bhd.
  • Rapid Synergy Bhd, which closed at limit down on 10 January 2023, was slapped with an unusual market activity query by Bursa Malaysia Securities Bhd.
  • Lagenda Properties Bhd has entered into a development rights agreement with Intact Corporate Approach Sdn Bhd to develop land in Kota Tinggi, Johor for a total cash consideration of RM85.4mn.
  • Ecomate Holdings Bhd has entered into a Sale and Purchase Agreement with Success Style Sdn. Bhd. for the acquisition of 1 plot of vacant land located in Muar Furniture Park for a total cash purchase consideration of RM3.6mn.
  • Nestcon Bhd has accepted the letter of award worth RM108mn awarded by Exsim Avenue Sdn. Bhd for a mixed commercial development project.
  • Leader Steel Holdings Bhd has accepted a notice of award and offer for compensation (Form H) from the Klang Land Office invoking a compulsory acquisition under the Land Acquisition Act 1960 (Act 486) to acquire 28.9k square metres of land in Mukim Kapar, Klang for RM42.6mn cash.
  • Ivory Properties Group Bhd signed an agreement to proceed with its disposal of a 1.2-acre (0.5-hectare) freehold land in George Town, Penang to Chin Hin Group Property Bhd for RM40.0mn.
  • The eurozone may have been in recession last quarter and prospects remain weak, European Central Bank vice president Luis de Guindos said.
  • Wholesale inventories in the U.S. dipped 0.2% in November after falling by a revised 0.3% in October.

Source: TA Research - 11 Jan 2024

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