Previous Day Highlights

FBM KLCI closed at an intra-day high, as bargain hunting activities emerged late in the session. The benchmark index was up 0.32% or 5.15 pts to end at 1,590.09. All the sectors were positive with telecommunications (+1.9%), health care (+1.4%), and property (+1.2%), leading the gains. Market breadth was also positive with 673 gainers against 411 losers. Total volume stood at 4.3bn shares valued at RM3.08bn.

Major regional indices trended mixed. HSI closed almost unchanged at 17,718.61. SHCOMP increased 0.73%, to close at 2,967.40. Nikkei 225 rose 0.61%, to finish at 39,583.08. STI slipped 0.32%, to end at 3,332.80.

Wall Street closed in negative territory, dampened by unchanged inflation data and political uncertainty. The DJIA slid 0.12%, to end at 39,118.86. Nasdaq dropped 0.71%, to close at 17,732.60. S&P500 declined 0.41%, to finish at 5,460.48.

News For The Day

SNS Network’s 1Q net profit slipped more than 50%

SNS Network Technology reported its 1QFY1/25 net profit more than halved to RM3.74m from RM7.89m, mainly due to lower revenue and an increase in selling and distribution expenses. Quarterly revenue dropped 26.31% YoY to RM213.59m from RM289.84m, lowest recorded revenue since its IPO. SNS has recommended an interim dividend of 0.25 sen, payable August 28. The group has secured an order worth RM85.52m to supply AI hardware, delivery is scheduled for 3Q24. -The Edge Markets

Hiap Teck’s 3Q net profit triples

Hiap Teck Venture’s 3QFY7/24 net profit surged threefold to RM46.82m from RM15.03m YoY, driven by a higher share of profit from a joint venture company. Revenue increased 7.14% YoY to RM399.68m from RM373.03m on higher sales volumes, despite lower average selling prices. -The Edge Markets

Cypark posts RM58m net loss in 4Q

Cypark Resources registered a net loss of RM57.92m for 4QFY4/24 on revenue of RM56.32m, as the loss stemmed from a RM46m derecognition of deferred tax assets in certain entities within the group as well as administration costs. -The Edge Markets

MCE’s 3Q profit down 49% on higher operating expenses

MCE Holdings reported its 3QFY7/24 net profit plummet by 48.6% YoY to RM2.42m from RM4.7m, due to higher operating expenses and effective tax rates. Quarterly revenue declined by 4.4% YoY to RM37.39m from RM39.13m attributed the lower revenue to two major festive holidays during the quarter, resulting in fewer working days. -The Edge Markets

Superlon’s 4Q net profit jumps threefold

Superlon Holdings’ 4QFY4/24 net profit jumped more than threefold YoY to RM2.05m from RM608,000, thanks to higher gross profit amid increased demand for its products and lower effective group taxation. Quarterly revenue climbed 26.4% YoY to RM30.9m from RM24.43m due to higher sales volume. The higher profitability was attributable to lower material costs and favourable exchange rate movements.-The Edge Markets

Haily wins RM53.72m construction contract

Haily Group has secured a RM53.72m construction contract in Pulai, Johor from Venice View Development SB. Haily said its wholly-owned subsidiary, Haily Construction SB accepted a letter of award from Venice View The project is slated to be completed within 15 months from the date of commencement. -The Star

Our Thoughts

Wall Street closed lower as traders are digesting the latest economic data released last Friday, as May’s inflation is within consensus estimates but consumer sentiment is on the rise. Nonetheless, the majority still feels that the Federal Reserve may adjust interest rates in September. As such, the DJIA lost 45 points while the Nasdaq declined by 126 points as the US 10-year yield edged higher to 4.392%. In Hong Kong, the HSI pared earlier gains to end the day flat as sentiment turned cautious on China’s growth trajectory. On the home front, the FBM KLCI finally managed to close in positive territory at the 1,590 mark. We believe the domestic market undertone to improve following a rather muted inflation data from the US thus expect the index to hover within the 1,590-1,600 range today. Meanwhile, the weakening of the Japanese yen against the greenback to a 38-year low could prompt possible fresh realignments of portfolios out of the Japanese stock market and into other Asian markets.

Source: Rakuten Research - 1 Jul 2024

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