Previous Day Highlights

FBM KLCI continued to climb for the third consecutive day amid optimism for a Fed rate cut. The benchmark index gained 0.29% or 4.74 pts to close at 1,623.12. Majority of sectors were positive with construction (+2.7%), property (+2.1%), and telecommunications (+0.9%), leading the gains; while losers were seen in energy (-0.1%), and plantation (-0.1%). Market breadth was positive with 761 gainers against 478 losers while 471 remained unchanged. Total volume stood at 5.39bn shares valued at RM4.41bn.

Major regional indices trended positive, leveraged on

Wall Street overnight performance. HSI skyrocketed 2.06%, to end at 17,832.33. SHCOMP surged 1.06%, to close at 2,970.39. Nikkei 225 jumped 0.94%, to finish at 42,224.02. STI rose 0.44%, to close at 3,475.06. Wall Street closed on a mixed note as megacaps retreated while small caps soared. The DJIA added 0.08%, to end at 39,753.75. Nasdaq dived 1.95%, to close at 18,283.41. S&P500 slumped 0.88%, to finish at 5,584.54.

News For The Day

Astro gets RM735m additional tax bill from IRB

Astro Malaysia Holdings has been served with an additional tax bill of RM734.88m, for the years of assessment of 2019 to 2023, including penalties. Notices for the additional tax were received by its wholly-owned units Astro Shaw SB and MEASAT Broadcast Network Systems SB on Tuesday. Astro Shaw's notice showed an additional tax of RM22.01m while MBNS has to pay RM712.87m. The notices for additional assessment were issued as production costs incurred during the said years of assessment were disallowed for deduction. -The Edge Markets

Shin Yang injects East Malaysia car dealership for RM144.5m

The Ling family behind shipping company Shin Yang Group is injecting part of their Toyota and Lexus car dealership business in East Malaysia into Shin Yang for RM144.5m, in a cash and share deal. Shin Yang had signed two separate agreements to buy Boulevard Jaya SB, an authorised dealer of Toyota vehicles in Sarawak and an authorised agent of Lexus vehicles in the state and to take up a 60% stake each in 3 other companies involved in related automotive businesses. The acquisitions are to diversify its revenue stream. -The Edge Markets

Bank Negara maintains OPR at 3%

Bank Negara has kept the overnight policy rate (OPR) unchanged at 3% following the conclusion of its two-day monetary policy committee (MPC) meeting. The decision was in line with the expectations of economists.-The Star

Aneka Jaringan bags RM53m sub-contract in Selangor

Aneka Jaringan Holdings has secured a RM53m sub-contract for the execution of bored piles and precast reinforced concrete piles works in Selangor. The sub-contract was awarded to its wholly owned subsidiary Aneka Jaringan SB by Grand Dynamic Builders SB. The project, scheduled to start on July 17 and is expected to be completed by March 1, 2025, involves the construction of a new logistics hub for Strategic Sonata SB. -The Edge Markets

G3 Global secures 30-year concession in Maldives

G3 Global has secured a project to develop the National Integrated Migrant Workers Dormitory (NiMWD) for the Maldives government. The project will be undertaken through a public-private partnership model, with 100% private finance initiative and revenue sharing between Maldives and G3 Global. The concession period for the project is 30 years, starting from the date of issuance of the land lease, with an automatic extension of an additional period of 30 years.-The Edge Markets

Our Thoughts

Wall Street closed mixed as traders are rotating out of the mega tech companies following June’s tame CPI figure and high likelihood of a rate cut in September. As a result, the DJIA added 32 points while the Nasdaq lost 364 points with the US 10-year yield ending lower at 4.211%. Over in Hong Kong, the HSI gained 360 points following China’s latest move to curb short selling to boost confidence. Sentiment was further buoyed from signs that the Federal Reserve will adjust interest rates in September. Back home, the FBM KLCI closed higher as stock accumulation persists despite some profit taking activities. We reckon buying interests may be gaining momentum as daily traded volume surpassed the 5bn shares level. As such, we believe the index to hover between the 1,620-1,630 range today.

Source: Rakuten Research - 12 Jul 2024

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