Review & Outlook

The local blue-chip benchmark was stuck in rangebound trade Tuesday, in line with regional markets as traders digested announcements by China's top leaders for bolder stimulus measures next year to revive the world's second-largest economy. The FBM KLCI shed 2.46 points to close at 1,608.97, off an early high of 1,615.93 and low of 1,607.88, but gainers edged losers 534 to 513 on moderate turnover of 2.74bn shares worth RM2.64bn.

The local market should remain in consolidation mode as investors await the release of US inflation and personal spending data later this week for clearer direction on the Fed's future interest rate cuts. Immediate index resistance remains at 1,628, next 1,648, followed by the September peak of 1,675. Immediate support stays at 1,588, the 38.2%FR of the 1,529 low (6 Aug) to 1,684 high (29 Aug) rally, with stronger key supports at 1,565, the 23.6%FR level, and then 1,550.

Overbought momentum indicators on Hartalega implies near-term correction potential towards the 138.2%FP (RM3.68), with the 123.6%FP (RM3.44) and RM3.25 acting as stronger supports, before stabilizing. Next significant resistance capping upside will be at the 161.8%FP (RM4.07) and 176.4%FP (RM4.31) ahead. A further rise in Kossan shares should meet stronger profit-taking resistance towards the 123.6%FP (RM3.09) followed by the 138.2%FP (RM3.33). Key support is found at the 76.4%FR (RM2.33), with stronger support at the 61.8%FR (RM2.10) and 50%FR (RM1.91).

News Bites

• Malaysia's industrial production index rose 2.1% YoY in October versus Bloomberg median forecast of 2.6% and September's 2.3% YoY gain.

• Malaysia has successfully recorded a total approved investment of RM254.7bn (+10.7% YoY) across various economic sectors during the first nine months of this year.

• Southeast Asia's second-largest bank, Oversea-Chinese Banking Corporation Limited and fifth-largest, CIMB Group Holdings Bhd, are vying for a controlling stake in Bank Pan Indonesia, people with knowledge of the matter said.

• Gamuda Bhd is acquiring a 20% stake in Cloud Space Sdn Bhd, a Google Cloud premier partner, for RM18mn.

• SkyWorld Development Bhd has signed an agreement with the Penang state agencies to jointly develop the country's largest affordable housing project that is valued at RM13bn.

• PGF Capital Bhd is acquiring two parcels of freehold land, totalling approximately 9.6 acres in Kulim Hi-Tech Park, Kedah, for a mixed development project, which will include a condominium, hotel, serviced residences, and several commercial elements valued at RM600mn.

• FGV Holdings Bhd announced that its plan to develop an integrated dairy farm business in Chuping, Perlis has lapsed due to the expiration of the deadline for meeting the necessary conditions precedent in the shareholders' agreement.

• Mega First Corporation Bhd, which has added a fifth turbine generator unit to boost the power generation capacity of its Don Sahong hydropower project in Laos, has secured a five-year extension to its 25-year concession for the project.

• JHM Consolidation Bhd's 52%-owned subsidiary JHM Dekai Auto Lighting Sdn Bhd has secured a contract with an estimated value of RM300mn for the supply of parts for specific car models to Perusahaan Otomobil Nasional Sdn Bhd.

• MN Holdings Bhd has won a contract worth RM162.6mn for design and building works at a hyperscale data centre in the southern region of Peninsular Malaysia.

• OCK Group Bhd is expanding its renewable energy portfolio with a proposed RM350mn investment in a large-scale solar photovoltaic power plant in Malaysia through Solarpack Suria Sungai Petani Sdn Bhd.

• Sunview Group Bhd through its wholly owned unit Fabulous Sunview Sdn Bhd, has secured two contracts worth a combined RM196.1mn to build two ground-mounted photovoltaic solar power plants with an installed capacity of 40MWp in Sungai Petani, Kedah.

• Power Root Bhd had inked a sale and purchase agreement with Ree Fong Agriculture Sdn Bhd for the acquisition of five lots of freehold agricultural land in Kulai, Johor, for a cash consideration of RM20.0mn.

• SNS Network Technology Bhd has reported a five-fold rise in its 3QFY25 net profit to RM10.2mn from RM2.0n a year earlier, on improved margins and sales in both online and physical store channels.

• China's exports grew 6.7% YoY last month, missing a forecast 8.5% increase and down from a 12.7% rise in October.

Source: TA Research - 11 Dec 2024