TA Sector Research

Daily Market Commentary - 16 Apr 2024

Publish date: Tue, 16 Apr 2024, 10:39 AM

Review & Outlook

Bursa Malaysia shares slumped on Monday as geopolitical tensions in the Middle East spiked after Iran's drone and missile strikes on Israel over the weekend. The FBM KLCI fell 8.51 points to end at the day's low of 1,542.53, off an early high of 1,548.34, as losers swarmed gainers 993 to 230 on total turnover of 4.28bn shares worth RM3.25bn.

Stocks should stay in profit-taking consolidation mode with sentiment clouded by heightened Middle East geopolitical tensions and risks for elevated inflation, which could force global interest rates to stay higher for longer. Immediate index supports are at 1,533 and 1,511, the respective rising 50-day and 100-day moving averages, with better support at 1,500. Overhead resistance remains at 1,580, with stronger upside hurdles seen at 1,600 and then 1,620.

Bumi Armada will need sustained strength above the 76.4%FR (63sen) to fuel upside momentum towards the 7/3/23 peak (73sen), while a confirmed breakout should aim for the 123.6%FP (82sen) ahead, with the 200-day ma (53sen) to cushion downside. Dialog need convincing break above the 76.4%FR (RM2.44) to enhance upward momentum towards the 25/1/23 peak (RM2.68), with next key upside hurdle at the 123.6%FP (RM2.92), while the 200-day ma (RM2.10) limits downside risk.

News Bites

  • Malaysia's palm oil stockpile shrank 10.68% in March from a month earlier as exports rose faster than production, official data showed.
  • Malaysia's central bank reaffirmed that it is ready to support the ringgit, which is hovering close to its lowest level since 1998.
  • RHB Bank Bhd has subscribed for an additional 3.8mn new Boost Bank Bhd shares for RM3.8mn cash to maintain its 40.0% equity interest in the latter.
  • Capital A Bhd has clarified that its management "is in the midst of exploring a potential fundraising exercise by its aviation business", but has no intention to undertake a private placement of new Capital A shares.
  • Heitech Padu Bhd has secured a contract worth RM190.0mn from the Road Transport Department Malaysia for the maintenance and technical support for ICT Infrastructure.
  • Kumpulan Kitacon Bhd has bagged a RM134.8mn main building works job from Tropicana Alam Sdn Bhd to build a double-storey terrace housing development in Puncak Alam, Selangor.
  • YNH Property Bhd said the independent review of its joint venture and turnkey construction agreements, which was initially slated to be completed this week, needs more time.
  • Iris Corporation Bhd has called off the sale of an 80.0% stake in its wholly-owned Iris Information Technology Systems Sdn Bhd for RM70.0mn cash.
  • Bandar Utama City Centre Sdn Bhd has chosen Solarvest Holdings Bhd to install Malaysia's largest on-site photovoltaic panels and buildingintegrated photovoltaic panels at 1 Utama Shopping Centre.
  • Sarawak Consolidated Industries Bhd's unit SCIB Properties Sdn Bhd has signed a settlement cum appointment of contractor agreement with Awana JV Suria Saga Sdn Bhd to strengthen its position in the construction sector.
  • G Capital Bhd has entered into a MoU with Hong Kong-based CCIAM Logistic Company Limited to engage CCIAM Logistic for comprehensive services for the 26 MWac small hydropower project in Pahang and raising capital up to RM325.0mn.
  • Eduspec Holdings Bhd has appointed Datuk Alex Kang Pang Kiang as executive deputy chairman effective April 15.
  • EP Manufacturing Bhd said it has teamed up with China-based BAIC Motor Corporation Ltd to assemble and manufacture BAIC's authorised model vehicles in Malaysia.
  • Master Tec Group Bhd expects higher revenue growth and a demand shift towards aluminium in conductors, amid the recent surge in copper prices.
  • The value of retail purchases in the US, unadjusted for inflation, increased 0.7% MoM in March.

Source: TA Research - 16 Apr 2024

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