Review & Outlook

The local market ended mixed on Thursday, as blue chips consolidated while rotational buying interest shifted to the healthcare sector which rose 2%, with focus on rubber glove stocks. The FBM KLCI closed up 1.43 points at 1,616.75, after moving between early low of 1,614.71 and high of 1,619.75, as gainers edged losers 586 to 558 on moderate turnover of 4.93bn shares worth RM3.79bn.

Buoyant global markets due to recent weaker US economic data, which enhanced probability for interest rate cuts towards the year-end, should spillover to shore up local sentiment ahead of the weekend. Immediate index resistance remains at the early June high of 1,622, with the May high of 1,632 and 1,640 as tougher upside hurdles, while immediate supports are at 1,593 and 1,569, the respective 50-day and 100-day moving average levels.

Supermax need breakout confirmation above the upper Bollinger band (97sen) to enhance upside momentum and aim for RM1.04/1.10 and RM1.20 ahead, while chart supports at 85sen/80sen limit downside risk. Meantime, Top Glove will need to overcome resistance from recent highs of RM1.25/1.31 to fuel further upside towards RM1.40/1.52 and RM1.65 going forward, with key chart supports at RM1.00 and 90sen cushioning downside.

News Bites

• Three thousand smart factories powered by 5G, which will be in operation by 2030, are expected to contribute RM36.8bn to national GDP says the Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz.

• Toyo Ventures Holdings Bhd has confirmed the termination of the Song Hau 2 thermal power plant project by the Vietnamese government.

• Keyfield International Bhd's wholly-owned subsidiary Keyfield Offshore Sdn Bhd has successfully secured two contracts, totalling RM4mn, to supply accommodation workboats.

• SNS Network Technology Bhd has partnered with global health advocate Healthcare Information Management Systems Society to advance digital healthcare transformation in Malaysia.

• AwanBiru Technology Bhd, a technology and talent digitalisation enabler, has bagged a RM25.7mn contract from the Ministry of Education to provide cloud-based solutions.

• MMAG Holdings Bhd's subsidiary has inked a cargo interline agreement with Capital A Bhd's logistics arm Teleport Everywhere Pte Ltd to improve cargo operations.

• Mudajaya Group Bhd said its former employee Michael Chua Khian Keng has filed an appeal on July 1 to challenge the High Court's decision that he and his wife are liable to pay RM43.6mn in the civil suit brought against him by the group.

• Gromutual Bhd's wholly-owned subsidiary has executed a sale and purchase agreement with Vermi Industries Sdn Bhd for the disposal of a piece of land with a building in Kulai, Johor, for RM4.8mn.

• NTT DATA Japan Corp is now in control of GHL Systems Bhd after accumulating 92.7% of the payment solutions provider's total issued shares as at July 4, paving the way for GHL to be delisted from Bursa Malaysia.

• The European Union moved ahead with plans to impose provisional tariffs on imports of electric vehicles made in China that would raise rates to as high as 48%, a step likely to escalate trade tensions with Beijing.

Source: TA Research - 5 Jul 2024