TA Sector Research

Daily Market Commentary - 1 Mar 2024

Publish date: Fri, 01 Mar 2024, 11:38 AM

Review & Outlook

Stocks closed mixed on Thursday as investors digested the final batch of the current corporate earnings season and await the keenly anticipated US PCE price index for inflation leads. The FBM KLCI gained 5.85 points to close at 1,551.44, after moving between early low of 1,544.67 and high of 1,554.79, but losers beat gainers 679 to 370 on active trade totalling 5.34bn shares worth RM7.01bn.

The local market should stay range bound ahead of the weekend, with investors closely monitoring key inflation data from the US for stronger cues on the inflation and interest rate trend. Key index supports cushioning downside on profit-taking pullbacks will be at 1,545, 1,524 and 1,508, the respective rising 10-day, 30-day and 50-day moving averages. Immediate resistance remains at 1,580, with stronger upside hurdles coming at 1,600 and 1,620.

MRCB will be attractive to bargain on further weakness for rebound upside towards the 150%FP (62sen), with tougher hurdles seen at the 161.8%FP (65sen) and 176.4%FP (69sen), with support from the 50-day ma (54sen) and 51sen cushioning downside. UEM Sunrise need sustained strength above the 123.6%FP (RM1.11) to fuel further upside momentum and target the 138.2%FP (RM1.21) and 150%FP (RM1.30) ahead, while support at 94sen and the 100-day ma (87sen) should cap downside risk.

News Bites

  • Malaysia government's debt grew 8.6% YoY to RM1.17tn as of the end of December 2023, constituting 64.3% of gross domestic product, according to the Finance Ministry.
  • Bank Negara Malaysia is prepared to sell US dollars from its reserves to "restrict excessive weakness in the ringgit," Datuk Seri Amir Hamzah Azizan, the nation's second finance minister, said.
  • Tropicana Corp Bhd is acquiring a piece of land in Kota Damansara measuring 7.79 acres for RM224mn to be developed into a residential area comprising four to five tower blocks of serviced apartments, with an estimated gross development value of about RM2.8bn.
  • Kumpulan Perangsang Selangor Bhd is disposing of Plaza Perangsang in Shah Alam for RM46mn to Perbadanan Kemajuan Negeri Selangor.
  • CIMB Group Holdings Bhd's net profit rose nearly 30% YoY to RM1.7bn for the 4QFY23 thanks to higher operating income and lower provisions.
  • Malaysia Airports Holdings Bhd's net profit for 4QFY23 dropped to RM287.7mn from RM359.1mn despite higher revenue of RM1.4bn versus RM1.0bn previously.
  • IHH Healthcare Bhd's net profit more than tripled YoY to RM727.4mn in its 4QFY23, driven by higher patient volumes and improved case mix, coupled with the absence of over RM300mn of impairment loss on its China assets and goodwill.
  • Boustead Heavy Industries Corporation Bhd's net loss ballooned in the 4QFY23 to RM256.7mn compared to RM26.5mn over the same period a year earlier, mainly due to provisions for the long-delayed littoral combat ships project.
  • 7-Eleven Malaysia Holdings Bhd has registered a record-high net profit of RM221.1mn for 4QFY23, compared with RM2.7mn a year ago, mainly boosted by the divestment gain.
  • Capital A Bhd reported a loss of RM159.6mn in the 4QFY23 compared with net profit of RM110.0mn over the same period a year prior final quarter of 2023, dragged by higher operating expenses, asset depreciation and higher financing costs.
  • Affin Bank Bhd said its net profit more than doubled to RM39.5mn in the 4QFY23 compared to a year ago, thanks to a sharp decline in provisions and lower taxes.
  • S P Setia Bhd has reported a 71.1% jump to RM148.2mn in its 4QFY23, helped by higher sales of its properties.
  • Malaysian Resources Corp Bhd said its net profit jumped to RM80.2mn for 4QFY23, from RM13.0mn a year earlier, as gains from disposal of two properties offset a decline in revenue.
  • AirAsia X Bhd's net profit tumbled 82.2% YoY to RM27.4mn in the 4QFY23 due to higher maintenance and overhaul cost, elevated staff cost and a rise in fuel prices.
  • DRB-Hicom Bhd posted a net profit of RM26.5mn for 4QFY23, compared with a net loss of RM100.1mn a year earlier, helped by higher financing income from its banking sector.
  • Kerjaya Prospek Group Bhd posted a net profit of RM35.7mn in the 4QFY23, up from RM28.6mn a year ago.
  • Bank of Japan board member Hajime Takata said on Thursday the central bank must consider overhauling its ultra-loose monetary policy, including an exit from negative interest rates and bond yield control.
  • The US core inflation increased 2.8% YoY in January, the smallest advance since March 2021, after rising 2.9% in December.

Source: TA Research - 1 Mar 2024

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