Review & Outlook

Blue chips stayed range bound on Thursday, as investors contemplate decisions from global central bankers in managing interest rates amid easing inflationary pressures. The FBM KLCI eased 1.32 points to close at 1,624.25, off an early high of 1,626.35 and low of 1,621.44, as losers beat gainers 654 to 442 on cautious trade totaling 3.51bn shares worth RM2.71bn.

The local market should trade sideways to lower ahead of the weekend, as investors await further leads from global economies on growth momentum, inflation and monetary policy. index supports are at 1,616, 1,608 and 1,586, the respective 30-day, 50-day and 100-day moving average levels, while immediate resistance remains at the recent high of 1,638, with 1,640 and 1,660 as tougher upside hurdles.

Further weakness on Ekovest is likely to attract buyers ahead of oversold rebound towards the 50%FR (49sen), with a breakout to aim for the 61.8%FR (52sen) and 76.4%FR (56sen) ahead, and key immediate supports at the 23.6%FR (41sen) and lower Bollinger band (40sen) capping downside. UEM Sunrise require renewed buying momentum to overcome the 138.2%FP (RM1.20) and target the 150%FP (RM1.29) and 161.8%FP (RM1.37) going forward, while the 200-day ma (99sen) provides crucial chart support.

News Bites

• The seasonally adjusted S&P Global Malaysia manufacturing purchasing managers' index dipped slightly to 49.7 in July from 49.9 in June.

• Capital A Bhd has submitted its extraordinary general meeting circular to Bursa Malaysia for the proposed disposals of its entire equity interest in AirAsia Aviation Group Ltd and AirAsia Bhd to AirAsia X Bhd.

• The High Court has granted an interim stay application applied by Astro Malaysia Holdings Bhd against the Inland Revenue Board's imposition of RM734.9mn additional tax against the pay television company's two subsidiaries for the years 2018 to 2023.

• Aeon Credit Service (M) Bhd has subscribed for a further 100.0mn new ordinary shares in its 50.0%-owned company Aeon Bank (M) Bhd for RM100.0mn at an issue price of RM1 per share.

• MN Holdings Bhd has secured a RM86.0mn substation engineering contract from Tenaga Nasional Bhd.

• Pekat Group Bhd plans to acquire a 60.0% stake in Apex Power Industry Sdn Bhd through the purchase of 75,000 shares for RM96.0mn in cash.

• Nova MSC Berhad has signed share subscription agreements with two Singapore-based firms for its subsidiaries, Dex-Lab Pte Ltd and Eyris Pte Ltd, with a total consideration of RM81.0mn.

• Eco World Development Group Bhd launched yesterday its latest industrial park series, QUANTUM, at ZEPP in Bukit Bintang City Centre, Kuala Lumpur.

• Asdion Bh has been classified as a Guidance Note 3 company after its external auditors, CAS Malaysia PLT, flagged material uncertainty that would affect the group's ability to continue as a going concern.

• After 21 years on Bursa Malaysia, GHL Systems Bhd set to be delisted next Tuesday, following a successful takeover by NTT Data Japan Corp.

• Mitrajaya Holdings Bhd has clinched a contract worth RM37.9mn for the construction of a four-storey building with one level of sub-basement car park in Kuala Lumpur.

• OM Holdings Ltd is expecting better earnings this year, amid higher prices and increased production volume.

• Precision engineering component manufacturer Northeast Group Bhd has received Bursa Malaysia's approval to list on the ACE Market.

• Pentamaster Corporation Bhd's net profit dropped 15.9% YoY to RM19.9mn for 2QFY24, from RM23.7mn a year ago, due to lower sales from the automated test equipment segment, higher employee expenses, and provisions for slow-moving inventories.

• CTOS Digital Bhd's net profit jumped 20.7% YoY to RM25.5mn for 2QFY24, from RM21.1mn a year ago, thanks to higher contributions from all customer groups, namely key accounts, commercial and directto-consumer.

• YTL Hospitality Real Estate Investment Trust reported a 9.7% YoY increase in net property income for its 4QFY24, rising to RM65.8mn from RM59.9mn a year earlier, driven by higher contributions from both the hotel and property rental segments.

• The Caixin/S&P Global manufacturing Purchasing Managers' Index dropped to 49.8 in July from 51.8 the previous month.

• The Institute for Supply Management said on Thursday that its manufacturing PMI dropped to 46.8 last month, the lowest reading since November, from 48.5 in June.

• Initial claims for state unemployment benefits in the US increased 14,000 to a seasonally adjusted 249,000 for the week ended July 27.

• Bank of England cuts rates by a quarter-point to 5% and would move cautiously going forward.

Source: TA Research - 2 Aug 2024