Buying Interest May Shift Towards Tech Stocks

Market Review

Malaysia: The FBMKLCI (-0.15%) Retreated After a 3-day Winning Streak, as Profittaking Activities Emerged Across Selected Banking and Utilities Heavyweights Like MAYBANK and YTLPOWR. Meanwhile, the Healthcare (+2.19%) Sector Advanced the Most, Led by Gloves-related Counters.

Global Markets: Both S&P500 and Nasdaq Rose to Records High on Friday and Posted a Third Straight Winning Week, as Investors Are Expecting a Further Rate Cut Later This Month Following the Non-farm Payroll Data. Meanwhile, the European Markets Closed Higher, While Asian Markets Ended Mixed Amid the Global Political Chaos.

The Day Ahead

The FBMKLCI Retreated After 3-day Winning Streak, as Profit-taking Activities Were Observed Across Certain Banking and Utilities Counters. Meanwhile, Wall Street Closed Higher After November Jobs Data Came in Slightly Better Than Expected, But Not Strong Enough to Deter the Federal Reserve From Considering Further Rates Cut. Traders Will be Monitoring Several Key Events This Week, Including (i) US 3Q GDP, (ii) Japan 3Q GDP, and (iii) China’s November CPI and PPI. In the Commodities Market, Brent Crude Oil Slipped Further Towards the USD71 Level and Will be Closely Watched After the Toppling of the Syrian Government. Gold Traded Sideways Around the USD2,650 Level While CPO Prices Advanced Further, Closing Above the RM5,100 Level.

Sector Focus: As the Market Approaches Year-end, We Believe Window Dressing Activities May Emerge Across Blue-chips, Especially Banking and Plantation Heavyweights. Meanwhile, We Believe Buying Interest to Pick Up in the Utilities, Construction, and Building Materials Sectors, Driven by the Recent Recovery in YTL and YTLPOWR Share Prices, Along With Earnings Realisation From the Construction of Data Center Facilities. Opportunities Will Shift Towards Data Centre Midstream Industries in the Technology Sector, Such as IT Solutions, Cybersecurity, HDD, EMS and OSAT, Following the Commencement of Data Construction Earlier This Year.

FBMKLCI Technical Outlook

The FBMKLCI retreated towards the 1,613 level after hitting the 60-day MA line. Meanwhile, the MACD Histogram expanded positively, and the RSI hooked above 50, indicating that the momentum is positive at this juncture. Resistance is envisaged around 1,628-1,633, and support is set at 1,593-1,598.

Company Briefs

Genting Bhd’s (GENTING) indirect wholly-owned subsidiary Resorts World Las Vegas LLC (RWLV) has announced the establishment of a board of directors with industry veteran Jim Murren as chairman, effective Dec 4, 2024. The integrated Las Vegas gaming resort also announced the appointment of Alex Dixon, who will come on board on Jan 16, 2025, as its chief executive officer. (The Edge)

JAKS Resources Bhd (JAKS) said its indirect subsidiary MNH Global Assets Management Sdn Bhd has filed for the establishment of a medium-term note (MTN) programme of up to RM250m with the Securities Commission Malaysia. MNH Global is involved in the investment holding and management of malls, JAKS' latest annual report showed. The group said the proceeds raised from the MTN issuance shall be used to refinance MNH Global’s existing financing. (The Edge)

The Employees Provident Fund (EPF) has emerged as a substantial shareholder in KIP Real Estate Investment Trust (KIPREIT) for the first time, after acquiring a 6.07% stake in the REIT, comprising 48.51m units. EPF, via Citigroup Nominees (Tempatan) Sdn Bhd, acquired the block of shares on Dec 3 via a private placement deal. The REIT announced on Dec 2 that its overall placement, totalling 180m shares, would be priced at 82.5 sen. (The Edge)

ITMAX System Bhd (ITMAX) said on Friday it is partnering with Aim-Force Sdn Bhd to jointly develop smart parking enforcement solutions, and enterprise mobility software and technologies for various projects. ITMAX said it has entered into a joint venture (JV) agreement with Aim-Force for the collaboration, which they will undertake via a JV company named Enforcemax that was incorporated on Nov 1 this year. ITMAX holds a 70% equity stake in Enforcemax, while Aim-Force owns the remaining 30%. (The Edge)

OSK Holdings Bhd’s (OSK) property arm, OSK Property Holdings Bhd, plans to expand its activities in Kedah with the acquisition of five parcels of plantation land totalling 330.53 acres (133.76 hectares) for RM72m. OSK Amanjaya Sdn Bhd, a wholly-owned subsidiary of OSK Property, is buying the land, located north of Sungai Petani, from Central Kedah Properties Sdn Bhd. (The Edge)

Kawan Food Bhd (KAWAN) is venturing into the supply and distribution of information technology equipment via a joint venture with several individuals, including its founder cum major shareholder, and its current chairman. It has, via its wholly-owned KG Pastry Marketing Sdn Bhd (KGPM), inked a joint venture agreement with Sun Cheng Leng, Huang Er-Wen, Gan Thiam Chai and Lim Hun Soon @ David Lim on Friday to undertake the business via a special purpose vehicle, Reka Innotech Sdn Bhd. (The Edge)

Cypark Resources Bhd (CYPARK) is partnering with the Terengganu state government to develop a 500-megawatt (MW) large hybrid hydro floating solar (HHFS) plant at Tasik Kenyir. Cypark said it has signed a head of agreement for the joint venture (JV) with Terengganu Incorporated Sdn Bhd (Terengganu Inc), the state’s strategic investment arm. The 500MW HHFS project is the first of its kind in Malaysia, harnessing Tasik Kenyir's water for clean energy generation. (The Edge)

FSBM Holdings Bhd (FSBM) said it has teamed up with a US technology firm to develop a consumer-to-manufacturer (C2M) platform for the Malaysian and Southeast Asian market. FSBM, which signed the collaboration agreement with Synergies Intelligent Systems Inc on Friday, said the project seeks to transform how custom-machining parts are produced to empower businesses to achieve greater efficiency. FSBM will help launch the C2M platform in Malaysia by providing IT solutions, onboarding clients and supporting operations. (The Edge)

MMAG Holdings Bhd (MMAG) has proposed a share capital reduction to wipe out up to RM270m of its accumulated losses. At the group level, MMAG’s accumulated losses stood at RM290.2m at the end of the audited 18 months ended Sept 30, 2024. This will be reduced to RM20.37m after the share capital reduction. (The Edge)

Crescendo Corp Bhd (CRESNDO) is selling more land for the development of data centres in Johor, this time for RM120.06m, cash. Crescendo said it signed an agreement with Data Cloud Innovation Sdn Bhd, a wholly-owned unit of UK-based Magma Holding Company Ltd, on Friday for the sale of five plots of freehold vacant land in Iskandar Puteri. (The Edge)

Source: Mplus Research - 9 Dec 2024