M+ Online Morning Market Buzz - 3 Aug 22

Dow Jones: 32,396.17 pts (-402.23pts, -1.23%)
⬆️ Resistance:  33700
⬇️ Support:  31200

FBM KLCI: 1,495.05 pts (-7.02pts, -0.47%)
⬆️ Resistance:  1540
⬇️ Support:  1440

HSI Index: 19,689.21 pts (-476.63pts, -2.36%)
⬆️ Resistance:  21200
⬇️ Support:  19200

Crude Palm Oil: RM3,779 (-RM62, -1.61%)
⬆️ Resistance:  4400
⬇️ Support:  3600

Brent Oil: $100.54 (+$0.51, +0.51%)
⬆️ Resistance:  112.90
⬇️ Support:  96.60

Gold: $1,760.39 (-$11.78, -0.66%)
⬆️ Resistance:  1830
⬇️ Support:  1680

M+ Online Technical Focus - 3 Aug 22
MTAG Group Bhd: Improving production efficiency

Trading Catalyst
• Leading labels and stickers printing and materials converting specialist in Malaysia with more than 600 customers, mainly in Malaysia.
• Acquisition of the fully digital press printing machine that generates high-quality colour output at highspeed printing in August 2021 bodes well to improve production efficiency.
• Prospective dividend yields at 6.1% and 8.2% for FY22f and FY23f respectively are also fairly attractive.
• Technically, traders may anticipate for a potential short-term breakout above RM0.49 to target the next resistances at RM0.52-0.54 with long term target set at RM0.56.

Technical View

(i) MTAG (S: RM0.445, R: RM0.52-0.54, LT TP: RM0.56, CL: RM0.44)

S: Support, R: Resistance, LT TP: Long term target price, CL: Cut loss

Market update: The FBM KLCI slipped on Monday alongside with the regional bourses as profit-taking activities emerged following a negative cue from Wall Street. The global markets may see an uneven recovery as investors weighed the escalating US-China tension and some hawkish comments from several Fed officials, which cause a surge in bond yields as investors priced in more interest rate hike. Nevertheless, we believe continuous buying from the foreign funds will support the local bourse. On the commodity markets, the Brent oil was traded above USD100, while the CPO fell below the crucial support of RM4,000. 

Sector focus: Given the Fed officials are turning slightly hawkish, traders may avoid technology stocks for the near term. However, we expect the defensive REIT sector may outperform ahead of the results this month coupled with the renewed market uncertainties. On the commodity related sectors, the energy and plantation sectors may see further selling pressure amid weaker underlying Brent oil and CPO prices.

Stocks to watch: 

Technology & Telco: CORAZA, JHM, MTAG, SAM, SFPTECH, UCHITEC, WONG
Consumer: AEON, KAWAN, MRDIY, PADINI
Property & REITs: ECOWLD, IGBREIT, IOIPG, PAVREIT, SPSETIA, YTLREIT
Building material & Construction: AME, PMETAL
O&G: COASTAL, GASMSIA, PANTECH
Finance: CIMB, MAYBANK, PBBANK, RHBBANK
Others: CENGILD, MAGNUM, MFCB, PGF, SCIENTX

Source: M+ Online

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