TA Sector Research

Daily Market Commentary - 29 Jan 2024

Publish date: Mon, 29 Jan 2024, 10:59 AM

Review & Outlook

With the FBM KLCI currently at the highest point in more than a year, and technical indicators reversing into positive mode, it will be crucial for positive domestic catalysts to resurface and sustain further uptrend ahead. Note that recent news flow on infrastructure, such as the proposed high speed rail from KL to Singapore and the Johor/Singapore Special Economic Zone should gain momentum going into February, with the new Agung to be sworn in likely to act as the catalyst to attract stronger investor participation.

For the index, 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 1,479, 1,471 and 1,459, the respective 30-day, 50-day and 100-day moving averages.

As for stocks picks this week, key gaming, banking and rubber glove related counters such as Genting Berhad, Genting Malaysia, Maybank, Public Bank, Hartalega, Kossan Rubber, Supermax and Top Glove should continue to attract bargain hunters on active rotational plays

News Bites

  • The Malaysian government has announced an additional quota of 400MW under the net energy metering programme for household, commercial and industrial segments from Feb 5 to Dec 31, 2024.
  • Tenaga Nasional Bhd will kick-start a 400MWh battery energy storage system pilot project in this quarter, marking Malaysia's first utility-scale battery storage project to address intermittency issues of renewable energy.
  • Malaysian Resources Corp Bhd, Berjaya Land Bhd and IJM Corp Bhd's unit IJM Construction Sdn Bhd confirmed that they are in a consortium, together with Keretapi Tanah Melayu Bhd, to bid for the Kuala LumpurSingapore high-speed rail project.
  • Capital A Bhd is believed to be seeking a valuation of some RM5bn for its planned sale of its aviation unit AirAsia Bhd that will eventually be merged with AirAsia X Bhd to be under AirAsia Aviation Group Ltd.
  • Maxis Bhd and Public Bank Bhd have formalised a collaboration through a Memorandum of Understanding to jointly promote digital adoption among Malaysian small and medium enterprises.
  • KLCC Property Holdings Bhd is buying the remaining 40% equity interest in Suria KLCC Sdn Bhd, which owns and manages Suria KLCC Mall, for RM1.95bn.
  • Tropicana Corp Bhd has proposed to sell its Courtyard by Marriott Penang Hotel for a total cash consideration of RM165mn, to a unit of IOI Properties Group Bhd.
  • Minister of Finance Inc-owned Ocean Sunshine Bhd is to fork out RM190.2mn to fund the working capital of 79.2%-owned littoral combat ship contractor Lumut Naval Shipyard Sdn Bhd via a share issuance exercise while Boustead Heavy Industries Corp Bhd which owns the remaining 20.8% stake is to issue 240mn new shares to its existing shareholders.
  • G Capital Bhd has further downsized the capacity of its 70%-owned unit's solar photovoltaic system on the premises of a wholly-owned unit of Chin Well Holdings Bhd to 2MW after design revisions.
  • Sarawak Consolidated Industries Bhd said it is acquiring leasehold plots in Demak Laut Industrial Park in Kuching from the Land and Survey Department of Sarawak measuring 8.9ha for RM21.6mn cash.
  • Nova MSC Bhd has secured an automation project worth RM20.8mn from Sys-Mac Automation Engineering Pte Ltd in Singapore with an option to purchase optional items and services as well as extend the maintenance by another 5 years.
  • Dataprep Holdings Bhd has announced that its Indonesia subsidiary has been selected as the winner and lead consortium member to construct and maintain passive telecommunication infrastructure in Bandung, Indonesia.
  • PJBumi Bhd has teamed up with Nutra Rich Energy Sdn Bhd to engage in collaborative efforts in the oil and gas sector in Malaysia and Indonesia.
  • Joe Holding Bhd, formerly GPA Holdings Bhd, is selling its entire 70% stake in its subsidiary GP Products Sdn Bhd to long-time shareholder Lim Siew Sooi for RM12.7mn.
  • Johor Plantations Group Bhd, which is slated for a Main Market listing on the local bourse, has inked a venture agreement with Fuji Oil Asia Pte Ltd, a subsidiary of Japan's Fuji Oil Group, to develop a specialty oils and fats refinery operating on RE.
  • China's central bank unveiled broad plans to guide money into sectors of national importance to boost the faltering economy this year, after making an unusual reserve requirement ratio announcement.
  • The US core PCE price index increased 2.9% YoY in December, the smallest gain since March 2021, after rising 3.2% in November.

Source: TA Research - 29 Jan 2024

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