TA Sector Research

Daily Market Commentary - 23 Apr 2024

Publish date: Tue, 23 Apr 2024, 10:16 AM

Review & Outlook

Bursa Malaysia shares rose on Monday, shored up by the firm external tone as investors shrugged off the tensions between Israel and Iran and awaited key economic data this week which will help finesse bets on the timing of rate cuts. The FBM KLCI gained 12.02 points to settle at 1,559.59, off the opening low of 1,548.38 and high of 1,559.94, as gainers thrashed losers 764 to 331 on total turnover of 3.49bn shares worth RM2.52bn.

Further improvement in the external market tone, corporate earnings and economic data would be essential to sustain further recovery from the recent sell-off. Immediate overhead resistance for the index will be from the recent high of 1,565, with stronger upside hurdles seen at 1,580 and then 1,600. Immediate supports remain at 1,535 and 1,514, the respective rising 50-day and 100-day moving averages, with better support at 1,500.

Gamuda should attract buyers on weakness for recovery upside towards the 138.2%FP (RM5.40), with the 150%FP (RM5.60) and 161.8%FP (5.78) as next upside hurdles, while key chart supports are from 200-day ma (RM4.71) and 08/11/23 low (RM4.60). Likewise, Suncon is attractive to bargain for recovery upside to the 150%FP (RM3.08), with next hurdle at the 161.8%FP (RM3.20) and immediate supports at the lower Bollinger band (RM2.71) and the 14/03/24 low (RM2.59).

News Bites

  • The World Bank has kept its 2024 economic growth outlook for Malaysia at 4.3%, though it sees a potential upside coming from higher oil prices due to the ongoing conflict in the Middle East.
  • Malaysia's international reserves fell 0.4% to US$113.4bn as of April 15 from a fortnight earlier, sufficient to finance 5.6 months of imports of goods and services, and is one time the total short-term external debt.
  • Nestlé (Malaysia) Bhd is set to adjust prices of selected products in response to the recent surge in global cocoa prices, said chief executive officer Juan Aranols.
  • Sapura Energy Bhd's wholly-owned subsidiary, Sapura Upstream Assets Sdn Bhd, is divesting its 50% equity interest in SapuraOMV Upstream Sdn Bhd to TotalEnergies Holdings SAS for RM3.37bn.
  • AirAsia is among six bidders for Sri Lanka's state-run carrier SriLankan Airlines as the island nation looks to reduce losses incurred by government-owned enterprises under a US$2.9bn International Monetary Fund programme.
  • Unitrade Industries Bhd's wholly-owned subsidiary has entered into a collaboration agreement with Huawei Technologies (Malaysia) Sdn Bhd and JJ-LAPP (M) Sdn Bhd to facilitate the purchase and sale of Huawei Digital Power-Smart Photovoltaic solutions.
  • Avaland Bhd formed partnerships with six companies to provide sustainable home fittings and finishings for its ongoing and upcoming projects in a signing ceremony at the developer's Collaboration of Sustainability event on Monday.
  • Powerwell Holdings Bhd's wholly-owned unit has secured a RM22.1mn sub-contract from One Ocean Environment Sdn Bhd to supply a low voltage switchboard for the first stage of Sg Rasau Water Supply Scheme development in Selangor.
  • Iris Corp Bhd is forming a joint venture with Sri Lankan firm Aitken Spence Plc to establish an offshore company that provides business processes outsourcing services in the Colombo Port City Special Economic Zone in Sri Lanka.
  • Paragon Globe Bhd broke ground for the Pekan Sentral Phase 3 and Pekan Nenas Industrial Park Phase 5 in Pekan Nenas, Johor on April 19, which have a combined gross development value of RM92mn and slated for completion by 2026.
  • Iconic Worldwide Bhd's wholly-owned unit Iconic Maison Sdn Bhd eyes over 70% take-up rate of its newly-launched residential development, Iconic Harmony, with RM300mn gross development value.
  • Awanbiru Technology Bhd is appealing Bursa Malaysia Securities' decision to suspend the trading of its shares, saying the group has demonstrated that its current business operations are viable, sustainable and have growth prospects.
  • Bursa Malaysia has demanded an explanation from HHRG Bhd on its proposal to purchase 51% stakes in two companies that jointly own a parcel of land in Kuala Muda, Kedah.
  • Ornapaper Bhd is proposing to diversify its existing businesses to include property development and property investment.
  • Norges Bank, which manages Norway's government pension fund, has emerged as a substantial shareholder in CPE Technology Bhd with a 5.5% stake.
  • China left benchmark lending rates unchanged at a monthly fixing on Monday, in line with market expectations.

Source: TA Research - 23 Apr 2024

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