Review & Outlook

The local blue-chip benchmark extended gains to a near two-year high on Wednesday, lifted by strength in healthcare, property, technology and telco heavyweights as regional markets climbed on strong US corporate earnings and economic data. The FBM KLCI rose 9.84 points to close at 1,571.48, off an early low of 1,564.89 and high of 1,572.48, as gainers swarmed losers 777 to 327 on robust trade of 4.25bn shares worth RM3.03bn.

While stocks should extend gains given the upbeat external sentiment, supported by strong US corporate profits and economic data, profittaking and overbought momentum is likely to cap upside potential. Immediate resistance for the index remains at 1,580, with stronger upside hurdles seen at 1,600 and then 1,620. Key supports will be at 1,546, 1,538 and 1,516, the respective rising 30-day, 50-day and 100-day moving averages.

Hartalega will need sustained strength above the upper Bolinger band (RM2.83) to enable challenge of the 8/1/24 high (RM3.05), with a confirmed breakout to aim for RM3.20 and the 123.6%FP (RM3.44) ahead, while downside risk is capped by the 61.8%FR (RM2.42) and 200-day ma (RM2.38). Kossan need convincing breakout above the 8/4/24 high (RM2.20) to fuel upside momentum towards the 123.6%FP (RM2.44) and 138.2%FP (RM2.59) going forward, with the 76.4%FR (RM1.95) and 61.8%FR (RM1.80) to cushion downside.

News Bites

• MyEG Services Bhd has inked an agreement to collaborate on the launch of a virtual asset fund or Hong Kong virtual assets exchangetraded fund products.

• Axis Real Estate Investment Trust is disposing of its property in Nusajaya, Johor, for RM162.0mn cash to a data centre operator.

• Mah Sing Group Bhd's land acquisition for its third development in Setapak, Kuala Lumpur, namely M Azura, has become unconditional and it has 3 months to pay the balance purchase price of about RM59,0mn.

• Capital A Bhd's board of directors has decided to extend Tan Sri Tony Fernandes' tenure as the chief executive officer for another 5 years, and as a strategic adviser to the airlines business.

• Hibiscus Petroleum Bhd has completed the drilling of the Bunga Aster- 1 exploration well and is expecting its first oil production to begin in May.

• Chin Hin Group Property Bhd had signed 2 agreements to develop 2 separate residential projects in Kuala Lumpur worth RM1.1bn in combined gross development value.

• I-Bhd is planning to issue up to 100mn preference shares to its major shareholder in a deal that could raise up to RM100.0mn at RM1.00/ share.

• Suria Capital Holdings Bhd's has roped in DP World, an Emirati multinational logistics company based in Dubai, to manage Sapangar Bay Container Port.

• Meta Bright Group Bhd have entered a solar supply agreement with Cherengin Hills Sdn Bhd and also has secured a new equipment leasing contract from Australian copper mining company Mt Cuthbert Resources Pty Ltd.

• Farm Price Holdings Bhd on Wednesday began taking orders from investors for its initial public offering on the ACE Market to raise up to RM32.4mn

• YNH Property Bhd is aborting the sale of a 6.5-acre land in Segambut and has appointed Chin Hin Group Property Bhd to develop the plot for a serviced apartment project that carries a potential gross development value of RM685.1mn.

• Fajarbaru Builder Group Bhd has bagged a RM252.3mn contract from WCT Holdings Bhd to undertake Phase 1 of a two-phase development of two blocks of serviced apartments in Johor Bahru.

• Jiankun International Bhd has inked a MoU with Micro Energy Holdings (M) Sdn Bhd to equip one of its residential developments named Taman Panchor Jaya in Nibong Tebal, Penang, with solar photovoltaic systems.

• OCR Group Berhad has entered into a joint venture agreement with Lecca Properties (M) Sdn Bhd to develop a landed residential project in Templer, Rawang, with an estimated gross development value of RM313.0mn.

• Sapura Industrial Bhd plans to collaborate with Mili Tech Sdn Bhd on feasibility studies for electrified vehicle products and potentially establish a joint venture business in Malaysia.

• Bank Indonesia raised the seven-day reverse repurchase rate by 25 basis points to 6.25%, its highest since the bank made the instrument its main policy rate in 2016.

• The US non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, increased 0.2% last month.

Source: TA Research - 25 Apr 2024