TA Sector Research

Daily Market Commentary - 9 Feb 2024

Publish date: Fri, 09 Feb 2024, 09:30 AM

Review & Outlook

Range bound trade persisted on the local bourse Thursday, with investors sidelined amid caution over US interest rates sustaining at current levels and the weaker Chinese economy. The FBM KLCI eased 0.75 points to close at the day's low of 1,512.36, off an early high of 1,521.18, but gainers led losers 574 to 361 on improved turnover of 3.24bn shares worth RM1.99bn.

Stocks should extend the recent sideways trend on muted trade as market players wind down further ahead of the extended Chinese New Year holiday break. Key index supports cushioning downside will be at 1,493, 1,482 and 1,467, the respective rising 30-day, 50-day and 100-day moving averages, while immediate overhead resistance remains at 1,520, with stronger upside hurdles at 1,550 and 1,580.

Any further dip on Supermax shares toward better supports from its 200-day ma (86sen) and 80sen should attract buyers looking for oversold rebound towards the upper Bollinger band (98sen), with tougher hurdles seen at RM1.04 and RM1.10 capping upside. Similarly, Top Glove shares are attractive to bargain on weakness toward support from the 100-day ma (83sen) and 80sen, ahead of rebound upside to recent high of RM1.02, and tougher resistance at RM1.10 and RM1.25.

News Bites

• Malaysia's wholesale and retail trade sales value rose 4.8% YoY to RM143.9bn in December 2023, driven by the retail trade sub-sector, which rose 5% to RM62.4bn. 

• Bank Negara Malaysia's international reserves slipped 0.26% to US$114.8bn (RM543.85bn) as at Jan 31, 2024, from US$115.1bn (RM545.27bn) on Jan 15, and is sufficient to finance 5.4 months of imports of goods and services and was one times the total short-term external debt. 

• CIMB Group Holdings Bhd has completed the acquisition of KAF Equities Sdn Bhd via CIMB Investment Bank Bhd, and the entity will be rebranded as CIMB Securities Sdn Bhd. 

• UEM Sunrise Bhd is poised to launch more freehold landed homes in Johor, particularly at Gerbang Nusajaya and Puteri Harbour, this year. 

• A group of Kumpulan Jetson Bhd's minority shareholders, who claimed to own at least 10% stake in the company, are making a second attempt to call for an extraordinary general meeting to replace the group's incumbent board of directors. 

• Independent adviser Inter-Pacific Securities Sdn Bhd has deemed the unconditional mandatory takeover offer for KUB Malaysia Bhd by JAG Capital Holdings Bhd major shareholder Datuk Seri Johari Abdul Ghani as "not fair and not reasonable", advising shareholders to reject the offer. 

• Reneuco Bhd's external auditor issued a disclaimer of opinion for the group's 15-month financial statements ended Sept 30, 2023 due to insufficient appropriate audit evidence. 

• Spritzer Bhd has formed a joint venture with KNP Development Sdn Bhd to develop a 5.8-acre piece of land in Matang, Perak into a housing development project. 

• Dataprep Holdings Bhd's Indonesian unit PT Jaringan Pintar Bersama inked an agreement with PT Bandung Infra Investama Tbk for a 30- year concession to develop and maintain passive telecommunication infrastructure in Bandung, Indonesia. 

• MGB Bhd's indirect wholly-owned unit MGB International for Industry has secured two purchase orders, totalling approximately 94.5mn riyals (RM119.6mn), from Saudi Arabia-based Sany Alameriah Industrial. 

• OceanMight Sdn Bhd, a 66.3% subsidiary of KKB Engineering Bhd, has entered into a memorandum of understanding with Samsung Engineering Co Ltd to cooperate in the tendering for potential global projects. 

• Southern Acids (M) Bhd entered into a share sales agreement to acquire the remaining 10% stake or 300,000 ordinary shares in Firstview Development Sdn Bhd from Low Mong Hua Sdn Bhd for a total cash consideration of RM23.5mn. 

• Perdana Petroleum Bhd's wholly-owned subsidiary, Perdana Nautika Sdn Bhd, has secured two work orders worth RM14.3mil. 

• Industronics Bhd is venturing into the halal F&B and halal convenience store business in Hong Kong. 

• China's central bank said it would keep policy flexible and precise to boost domestic demand, while maintaining price stability, amid signs of a patchy economic recovery and rising deflationary risks as its consumer price index fell 0.8% YoY in January. 

• The Bank of Japan will likely end its risky asset purchases but avoid raising interest rates rapidly when scaling back monetary support, Deputy Governor Shinichi Uchida said in the strongest hint to date that an end to its massive stimulus was nearing. 

• The US initial jobless claims decreased by 9,000 to 218,000 in the week ended Feb 3, according to the Labor Department data.

Source: TA Research - 9 Feb 2024

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