Broader Market Sentiment Turns Soft

Market Review

Malaysia: The FBMKLCI (-0.59%) Extended Its Third Consecutive Losses to Close at 1588.68, Dragged Down by Utilities Heavyweights Such as TENAGA and YTL. The Industrial Products & Services (+0.63%) Sector Gained the Most, Led by PCHEM and SUNWAY, While the Utilities (-1.75%) Sector Saw the Largest Decline.

Global Markets: The US Market Ended Higher as Investors Brushed Off Initial Concerns Over Nvidia’s Revenue Growth. Meanwhile, the European Market Advanced, While the Asian Market Closed Lower Following the Escalation in Ukraine-Russia Tension and Also the Plunge in India’s Adani Group.

The Day Ahead

The FBMKLCI Failed to Hold Above the 1,600 Mark as Utilities Stocks Were Sold Down. On the Flip Side, Wall Street Ended Higher as Initial Concerns Over NVIDIA’s Revenue Outlook Faded, With NVIDIA Assuring Investors of Strong Demand for Its New Product Lineup, Potentially Fuelling Another Rally. Bitcoin Surpassed the USD98k Mark and Is Approaching the Initial Target of USD100k. Key Economic Events Traders Will Focus on Include: (i) Eurozone HCOB Manufacturing & Services PMI, (ii) S&P Global Manufacturing & Services PMI, and (iii) US University of Michigan Consumer Sentiment. In the Commodities Market, Brent Crude Oil Rose About 2% to USD74. Gold Prices Remained Flat Around the USD2,600 Mark, While CPO Prices Retreated Below the RM4,800 Level.

Sector Focus: The Escalation of the Ukraine-Russia Conflict May Weigh on Market Sentiment But Could Present Opportunities in Gold and Oil-related Stocks and the Consumer Sector. We Also Favour the Aviation Industry as the Year-end Holiday Season Approaches. Also, the Strengthening USD and Trump Administration’s Tariffs Should Benefit Export-oriented Sectors Such as Technology and Gloves. Meanwhile, the Construction, Property, and Building Materials Sectors Remain Supported by Earlier Data Center Investments.

FBMKLCI Technical Outlook

FBM KLCI index failed to be supported above the 1,600 psychological mark. The technical readings were negative, with the MACD Histogram closing in the negative territory while the RSI is trending below 50. The resistance is envisaged around 1,603-1,608, and the support is set at 1,568-1,573.

Company Briefs

Petron Malaysia Refining & Marketing Bhd’s (PETRONM) net profit for the third quarter ended Sept 30, 2024 (3QFY2024) fell 94.3% to RM4.63m from RM81.9m in the same quarter a year earlier on fuel demand correction following the implementation of targeted diesel subsidy in June. Quarterly revenue fell 21.4% to RM3.81bn from RM4.85bn in 3QFY2023. (The Edge)

DRB-Hicom Bhd (DRBHCOM) posted a net loss of RM5.29m for 3QFY2024 compared to a net profit of RM70.8m in the same quarter last year, on lower vehicle sales and higher loss on derivatives of RM80.27m. Revenue for the quarter increased by 3.4% to RM4.13bn, compared with RM4bn. (The Edge)

Dayang Enterprise Holdings Bhd’s (DAYANG) net profit for 3QFY2024 surged 76.67% to a record high RM134.94m from RM76.38m in the same quarter last year, as vessel utilisation and daily charter rates improved. Revenue jumped 30.48% to RM448.51m from RM343.76m. (The Edge)

AEON Co (M) Bhd’s (AEON) net profit for 3QFY2024 rose 35.4% to RM18.79m from RM13.88m a year earlier, as quarterly revenue rose 4.9% to RM1bn from RM955.9m, driven by growth across all business segments. (The Edge)

7-Eleven Malaysia Holdings Bhd’s (SEM) net profit for 3QFY2024 fell 24% to RM10.93m from RM14.32m in the same quarter last year, as operating expenses outgrew its 5.5% rise in revenue to RM744.05m from RM705.31m. It expects a better fourth quarter ahead. (The Edge)

MSM Malaysia Holdings Bhd’s (MSM) net loss for 3QFY2024 stood at RM49.75m versus RM36.06m in the same quarter last year, despite revenue rising 6.78% to RM861.44m from RM806.72m, due to higher forex losses. (The Edge)

Far East Holdings Bhd (FAREAST) has declared a special dividend of seven sen per share, payable on Dec 23, as its net profit for 3QFY2024 more than doubled to a record RM64.45m from RM31.55m in the same quarter last year on higher production coupled with higher crude palm oil (CPO) and palm kernel (PK) prices. Revenue jumped nearly 76% to RM252.82m, compared to RM143.74m. (The Edge)

Hap Seng Consolidated Bhd’s (HAPSENG) net profit for 3QFY2024 jumped threefold to RM193.11m from RM50.3m in 3QFY2023, though revenue slipped 3.94% to RM1.48bn from RM1.54bn due to weaker credit financing and automotive and trading divisions, mitigated by higher revenue from its plantation and property and building materials divisions. The group declared a second interim dividend of 10 sen per share, payable on Dec 19. (The Edge)

Sunway Construction Group Bhd’s (SUNCON) net profit for 3QFY2024 jumped 32.71% to RM46.47m from RM35.01m in the same quarter last year, as revenue rose 28.48% to RM865.33m from RM673.51m on the accelerated progress of its data centre projects. A second interim dividend of 2.5 sen per share was declared, payable on Dec 26. (The Edge)

UEM Sunrise Bhd’s (UEM) net profit for 3QFY2024 jumped to RM23m from RM8.34m in 3QFY2023, as revenue rose 18.24% to RM369.33m from RM312.35m — mainly driven by the sales of non-strategic lands in Iskandar Puteri, Johor, but offset by a weaker property development segment. (The Edge)

Mega First Corp Bhd’s (MFCB) net profit for 3QFY2024 rose 13.8% to RM116.64m from RM102.53m a year earlier, underpinned by stronger renewable energy and resources segments. Quarterly revenue grew 16.1% to RM372m from RM320.38m a year ago. (The Edge)

Oriental Holdings Bhd’s (ORIENT) net profit for 3QFY2024 fell 70.12% to RM88.87m, from RM297.42m on the absence of one-off gains recognised in the corresponding quarter last year. Revenue for the quarter rose 20.72% to RM1.31bn from RM1.09bn on higher automotive sales led by the Honda Civic. (The Edge)

Heitech Padu Bhd (HTPADU) recorded a net profit of RM6.58m for the third quarter ended Sept 30, 2024 (3QFY2024), compared with a net loss of RM1.4m in the corresponding quarter, thanks to a one-off gain on disposal of land and building. Revenue for the quarter rose 71.95% to RM109.08m from RM63.44m a year earlier but weighed by a surge in expenses for the purchase of hardware and software. (The Edge)

Can-One Bhd’s (CANONE) net loss for 3QFY2024 widened to RM100.54m from RM23.12m in the previous corresponding quarter, dragged by unrealised foreign exchange loss of RM80.6m. Quarterly revenue, however, grew by 8.93% to RM793.46m from RM728.44m, on better contribution from general packaging, contract manufacturing and property development divisions. (The Edge)

Atlan Holdings Bhd's (ATLAN) Singapore-listed subsidiary 75.53%-owned Duty Free International Ltd (DFIL), which plans to challenge the compulsory acquisition of two plots of land in Kedah by the Malaysian government, announced it had received RM69.6m as compensation for the land. DFIL had previously said in a bourse filing with the Singapore Exchange that it would accept the award of the compensation under protest as it is not satisfied with it, and that it would file an objection by way of a land reference to the High Court. (The Edge)

Maxim Global Bhd (MAXIM) will not pursue action against the revocation of plantation concession licences issued by Indonesia in January 2022 in relation to assets owned by two 90%-owned subsidiaries in Papua. It said the decision will not have any material financial implication to the group as the group has fully impaired its assets in the country. (The Edge)

Thong Guan Industries Bhd (TGUAN) has proposed a seven sen per share special dividend from proceeds of the sale of its food and beverage (F&B) business to its largest shareholder Foremost Equals Sdn Bhd for RM60m. (The Edge)

Globetronics Technology Bhd (GTRONIC) has inked an agreement valued at RM145m to provide integrated circuit product packaging, testing and backend services to Taiwan-based ChipMOS Technologies Inc. The contract is to span three years from Nov 21, 2024, to Nov 20, 2027. The contract’s value of RM145m is based on a volume forecast provided by ChipMOS. (The Edge)

Source: Mplus Research - 22 Nov 2024