Review & Outlook

Gains in property, utility and oil & gas heavyweights lifted the local benchmark index to close at a fresh 17-month high above 1,500 on Wednesday. The FBM KLCI climbed 7.99 points to end near session highs at 1,504.10, off an opening low of 1,497.16, as gainers led losers 690 to 360 on lower turnover of 4.34bn shares worth RM2.87bn.

While blue chips look set for further recovery, a positive catalyst will be key for a decisive break from current consolidation to sustain above the 1,500 level. Hence, a convincing break above the 1,500/1,510 resistance zone, which capped upside in Jan 2023, should aim for next key hurdles at 1,520 and 1,550. Key chart supports cushioning downside will be at 1,478, 1,469 and 1,458, the respective 30-day, 50-day and 100-day moving averages.

Sime Darby need to climb above the 161.8%FP (RM2.57) to sustain further rise towards the 176.4%FP (RM2.64) and 200%FP (RM2.76) ahead, with the rising 50-day ma (RM2.40) providing uptrend support. TM shares need breakout confirmation above the 123.6%FP (RM6.14) to extend uptrend and target the 138.2%FP (RM6.34) and 150%FP (RM6.50) going forward, while the rising 30-day ma (RM5.64) provide uptrend support and cushions downside.

News Bites

• Bank Negara Malaysia maintained its overnight policy rate at 3% following the Monetary Policy Committee meeting.

• According to sources, Berjaya Land Bhd's 70%-owned subsidiary Berjaya Rail Sdn Bhd has teamed up with IJM Corp Bhd, Malaysian Resources Corp Bhd and Keretapi Tanah Melayu Bhd to bid for the Kuala LumpurSingapore high-speed rail project.

• Tenaga Nasional Bhd is spearheading a "transformative partnership" with China's state-owned power utilities, aimed at revolutionising the Asean Power Grid through cutting-edge, high-voltage direct current technology.

• MISC Bhd has added 2 vessels to its current fleet, namely the floating production storage offloading vessel Marechal Duque de Caxias; and Eagle Veracruz, the group's latest liquefied natural gas dual-fuel very large crude carrier.

• IHH Healthcare Bhd's unit Pantai Medical Centre Sdn Bhd has inked an agreement with Pelaburan Hartanah Bhd for the development of a new medical block adjacent to the current Gleneagles Hospital Kuala Lumpur complex.

• Sime Darby Property Bhd, through its wholly owned subsidiary Seed Homes Sdn Bhd, has signed a shareholders' agreement with Lagenda Properties Bhd to set up Seed Homes Lagenda, a 50:50 joint venture to develop affordable housing.

• Wasco Bhd is disposing of a parcel of land together with storage buildings erected on site in Shah Alam for RM40mn to Array Metal (M) Sdn Bhd.

• AWC Bhd has secured a RM8.2mn contract from Gilang Cendana Sdn Bhd, a subsidiary of Putrajaya Holdings Sdn Bhd, to provide facility management, maintenance and operational services for commercial office building Suasana PJH in Precinct 2, Putrajaya.

• Sunzen Biotech Bhd's 70%-owned Ecolite Biotech Manufacturing Sdn Bhd is buying a 10% stake in Farmer International Holdings Sdn Bhd for RM4.3mn.

• Fajarbaru Builder Group Bhd has been appointed as the developer of an affordable housing project with a gross development value of RM192mn in Putrajaya by the federal territory's local authority.

• Green Packet Bhd is disposing of its 15% stake in CSH Solutions Sdn Bhd for RM3.5mn to Lai Kwok Ching, as part of its portfolio consolidation exercise.

• Jade Marvel Group Bhd has withdrawn its plans to raise up to RM80mn through the issuance of redeemable convertible preference shares to fund its money-lending business and working capital.

• Barakah Offshore Petroleum Bhd will explore other options in disposing of its Kota Laksamana 101 pipelay and accommodation barge, as its agreement to auction the vessel has lapsed.

• The public portion of metal fabricator Wentel Engineering Holdings Bhd's initial public offering was oversubscribed by 17.7 times.

• Frozen seafood specialist SBH Marine Holdings Bhd has entered into an underwriting agreement with KAF Investment Bank Bhd for the company's IPO, en route to a listing on the ACE Market.

• The US GDP grew at an annualized rate of 3.3% in the final quarter of last year, down from 4.9% in the previous quarter but in line with prepandemic growth, and well ahead of the 2% economists had expected.

Source: TA Research - 26 Jan 2024