Review & Outlook

Blue chips regained strength Thursday on late buying interest in consumer and banking heavyweights, while the broader market extended profittaking consolidation after recent gains. The FBM KLCI rose 4.33 points to close at 1,580.30, off an opening low of 1,574.27 and high of 1,582.68, but losers edged gainers 620 to 530 on reduced turnover of 3.81bn shares worth RM3.05bn.

Stocks should extend range bound trade ahead of the weekend, as investors await the closely watched US employment report for April for leads on the economic health of the US economy. Immediate resistance for the index remains at 1,600, with stronger upside hurdles seen at 1,620 and then 1,640. Key supports will be at 1,555, 1,545 and 1,522, the respective rising 30-day, 50-day and 100-day moving averages.

Gadang will need sustained strength above the 76.4%FR (41sen) to enhance upside potential for retest of the 15/4/22 high (45sen), with a confirmed breakout to aim for the 123.6%FP (49sen) ahead, while key supports are from the 100-day ma (38sen) and 200-day ma (35sen). WCT Holdings need breakout confirmation above the upper Bollinger band (55sen) to target the 61.8%FR (57sen) and 76.4%FR (62sen) going forward, with downside risk seen capped by the 38.2%FR (48sen).

News Bites

• The seasonally adjusted S&P Global Malaysia manufacturing purchasing managers' index rose to 49.0 in April from 48.4 in March, indicating a softer downturn in the country's manufacturing sector.

• Pasukhas Group Bhd has received a letter of acceptance from a leading multinational technology corporation headquartered in the US, for the construction and completion of a data centre located in Selangor for RM57.0mn.

• Boustead Heavy Industries Corp Bhd has secured a contract worth RM43.6mn from the Ministry of Defence for in-service support for the Royal Malaysian Navy's Prime Minister Class submarines.

• JAKS Resources Bhd's unit has signed a Memorandum of Understanding with China-based CALB Group Co Ltd to explore opportunities in the battery energy storage system market, with a particular focus on the Southeast Asia region.

• Protasco Bhd said its wholly-owned subsidiary, Kumpulan Ikram Sdn Bhd, has received an offer from Hong Kong-based Star Teenagers International Group Ltd to purchase Ikram Education Sdn Bhd, the operator of Infrastructure University Kuala Lumpur.

• Sarawak Cable Bhd has once again obtained a time extension to submit its Practice Note 17 regularisation plan from Bursa Malaysia. The deadline has now been extended by another six months to Sept 30 from March 31.

• Construction outfit and bus operator Epicon Bhd will exit PN17 status on Friday as it has regularised its financial condition.

• Annum Bhd received a show-cause notice from Bursa Malaysia over the company's failure to issue its annual report for the financial period ended June 30, 2023 (FY23), which was due on Oct 31, 2023.

• Yinson Holdings Bhd has closed the limited recourse term loan facility of up to USD1.3bn (RM6.2bn) for the financing of its Agogo floating, production, storage and offloading vessel, to be deployed in Angola.

• Ajinomoto (M) Bhd's RM2.12 special dividend announced in July last year will go ex on May 15. The payment date will be May 30.

• South Malaysia Industries Bhd has appointed Leow Thang Fong as its new chief executive officer, effective May 1, after a group of shareholders rejected him from being re-elected executive director at its annual general meeting in March.

• Frontken Corp Bhd's 1QFY24 net profit jumped 27.4% YoY to RM30.1mn, from RM23.6mn last year, mainly due to improved revenue and better profit margin.

• UOA REIT, a trust which mainly manages commercial properties, said its net rental income fell 12.7% in 1QFY24 due to lower occupancy rates and higher property operating expenses.

• The number of Americans filing new claims for unemployment benefits held steady at lower levels last week as the labour market remains fairly tight.

• New orders for U.S. manufactured goods surged in line with economist estimates in the month of March, according to a report released by the Commerce Department on Thursday.

• The global economy is growing faster than expected only a few months ago thanks to resilient US activity while inflation is converging more quickly than expected with central banks' targets, the OECD said on Thursday, upgrading its outlook.

Source: TA Research - 3 May 2024