Review & Outlook

Stocks entered profit-taking correction mode on Thursday, with selloffs being led by key index heavyweights in the technology and energy sectors as the recently announced USD500 billion investment to build AI infrastructure in the US reduced demand for data center projects globally. The FBM KLCI slipped 10.60 points to close at 1,577.20, off an early high of 1,586.52 and low of 1,575.67, as losers beat gainers 671 to 283 on higher turnover of 3.24bn shares worth RM2.75bn.

The local benchmark is expected to continue its consolidation amid a lack of domestic buying catalysts, while potential tax cuts and deregulation by the new Trump administration could encourage foreign capital outflows to the US. Immediate index resistance is maintained at 1,605, with the next upside hurdles at 1,630, followed by 1648. Immediate support remains at 1,550, with stronger supports at the 6/8/24 low of 1,529 and 1,500 psychological level.

Any price dips in IWCity shares should attract bargain hunters looking for a rebound upside to the 76.4%FR (60sen), with next major resistance coming from the 61.8%FR (68sen) and the 50%FR (75en) going forward. Immediate support is capped at the 100%FP (47sen) and 40sen. UEM Sunrise shares are attractive to accumulate at current depressed levels ahead of recovery to the upper Bollinger band (RM1.17), with the 20/05/ 24 high (RM1.28) and RM1.40 as tougher upside hurdles. Crucial supports cushioning downside are coming at the 61.8%FR (88sen) and 50%FR (76sen).

News Bites

• Malaysian Resources Corporation Bhd is partnering Ipoh Sentral Sdn Bhd to jointly develop the Ipoh Sentral project, with an estimated gross development value of RM6.3bn.

• Café chain operator Oriental Kopi Holdings Bhd is scaling up its product offerings in the fast-moving consumer goods segment, targeting the launch of over 20 products by year end.

• KIP Real Estate Investment Trust unitholders have approved the acquisition of 4 industrial properties associated to its largest shareholder, Datuk Eddie Ong Choo Meng, for a total purchase price of RM98.3mn.

• YTL Corporation Bhd and YTL Power International Bhd have each proposed a bonus issue of free warrants, on the basis of 1 free warrant for every 5 shares held in the respective companies.

• T7 Global Bhd has secured a contract with Hess Exploration and Production Malaysia BV for the provision of pan-Malaysian offshore maintenance, construction, modification and hook-up commissioning services.

• Citaglobal Bhd has secured 2 subcontracts worth a combined RM36.3mn for station works and other works as part of the Kuching Urban Transportation System project in Sarawak.

• Unitrade Industries Bhd's 51.0%-owned subsidiary Intergreen Metal Sdn Bhd has entered into a share sale agreement with Hong Ching Chung to acquire 51.0% equity interest in Kien San Metal Sdn Bhd for RM42.0mn to expand its business to Sabah and Sarawak.

• Rhong Khen International Bhd is selling its Vietnamese indirect subsidiary RT Industries Company Ltd to Singapore-based Maideli Pte Ltd for US$7.1mn (RM31.7mn) in cash.

• Econframe Bhd is buying Ipoh-based manufacturer and seller of wooden doors Ivory Pearl Sdn Bhd for RM56.0mn, in a move to expand its footprint in the UK and Australian markets.

• Censof Holdings Bhd has secured a RM4.3mn contract from pension fund Kumpulan Wang Persaraan (Diperbadankan), to replace and implement a new cloud-based accounting system.

• Westports Holdings Bhd reported a record-high net profit of RM256.7mn for the 4QFY24, a 25% YoY increase from RM206.1mn a year ago, driven by higher container revenue.

• IGB Real Estate Investment Trust net property income for 4QFY24 fell 6.4% YoY to RM107.9mn, primarily due to maintenance costs for mechanical and electrical equipment, upgrading and restoration works, and marketing expenses incurred in the quarter.

• Axis REIT's NPI for 4QFY24 rose 15.4% YoY to RM76.4mn, thanks to its newly acquired properties, new tenancies from its logistics warehouse Axis Mega Distribution Centre (Phase 2), as well as positive rental reversion from the existing portfolio.

• Destini Bhd 2QFY25 net profit surged by 54.5% YoY to RM6.1mn, mainly due to the delivery of trains and equipment by its mobility and aviation sectors, as well as cost-cutting measures undertaken by the company.

• Initial claims for state unemployment benefits in the US increased 6,000 to a seasonally adjusted 223,000 for the week ended Jan. 18.

• The Kremlin saw nothing particularly new in a threat by the US President Donald Trump to hit Russia with new sanctions and tariffs but said ready for dialogue and waiting for signals from the US.

Source: TA Research - 24 Jan 2025