Review & Outlook

Stocks fell on Wednesday, led by the technology (-2.7%), oil & gas (-2.1%) and utility (-1.2%) sectors, and dragged by sharper losses in the region due to renewed fears over US economic growth following the release of weak US manufacturing data. The FBM KLCI slid 6.41 points to close at 1,670.24, off an opening low of 1,662.22 and high of 1,675.53, as losers bashed gainers 813 to 307 on total turnover of 3.04bn shares worth RM2.89bn.

The local market should extend profit-taking consolidation in the nearterm and mirror the weaker external tone, with fresh worries over US growth dampening sentiment. Immediate index support remains at the recent correction low of 1,633, with 1,620 and 1,600 acting as stronger supports. Key resistance will be the recent high of 1,684, then 1,695, the Dec 2020 high, followed by the 123.6%FP (1,702) and 138.2%FP (1,741) of the 1,369 low to the 1,638 high.

MRCB will need breakout confirmation above the 76.4%FR (63sen), matching the 100-day ma level, to boost upside momentum and aim for the 20/5/24 high (74sen) and 123.6%FP (84sen) ahead, while key retracement supports at the 50%FR (51sen) and 38.2%FR (46sen) cushion downside. UEM Sunrise need decisive breakout above the 200-day ma (RM1.02) to fuel upside challenge of the 20/5/24 peak (RM1.28), with next major hurdle seen at the 123.6%FP (RM1.52), and key retracement support from the 50%FR (76sen) capping downside risk.

News Bites

• IHH Healthcare Bhd said it is acquiring the 600-bed Island Hospital in Penang for RM3.9bn in cash from Comprehensive Care Sdn Bhd.

• YTL Power International Bhd has confirmed that its subsidiary YTL Communications Sdn Bhd has been questioned by the Malaysian AntiCorruption Commission about the Ministry of Education's 1BestariNet project, valued at RM4bn.

• MSM Malaysia Holdings Bhd said it was not impacted by the recent crop fire in key producer Brazil, as it hedged all its raw sugar requirements under the wholesale segment in 2024.

• KIP Real Estate Investment Trust has completed the asset enhancement initiatives for its KIPMall Senawang in Negeri Sembilan.

• Central Global Bhd has bagged a RM616.4mn contract for the Pan Borneo Highway Sabah Phase 1B project.

• Elridge Energy Holdings Bhd's wholly-owned subsidiary, Bio Eneco Sdn Bhd has entered into a MoU with PT Orion APAC Indonesia for the sale and purchase of 150,000 tonnes of palm kernel shells annually over a three-year period.

• Jentayu Sustainables Bhd said it has received a letter of notification from the Energy Commission of Sabah for Project Oriole - a 162MW run-of-river hydropower plant in the state.

• Northport (M) Bhd recorded its highest-ever monthly container throughput for the second consecutive month, handling 365,558 20 TEUs in August 2024, up from 354,548 TEUs in July 2024.

• Loss-making Ocean Vantage Holdings Bhd announced the emergence of three new Sarawak-based substantial shareholders, following the disposal of a collective 23.3% stake by executive directors Martin Philip King Ik Piau and Yau Kah Tak, and one other.

• The Caixin China services purchasing managers index fell to 51.6 in August, compared with 52.1 in the previous month.

• Indonesia, the world's biggest palm oil exporter, plans to lower export levy rates of the tropical oil to improve competitiveness against rival vegetable oils and raise farmers' income.

• Job openings in the US, a measure of labour demand, had fallen by 237,000 to 7.673mn on the last day of July, the lowest level since January 2021.

• The Commerce Department said US factory orders spiked by 5.0% in July after plunging by 3.3% in June.

• Opec+ is discussing a delay in a planned output increase next month as oil prices hit their lowest in nine months, according to sources.

Source: TA Research - 5 Sept 2024