Previous Day Highlights

The FBM KLCI finished sharply higher, buoyed by buying interest in banking and telco stocks. The benchmark surged 0.813% or 13.33 pts to close at 1,652.29. Gainers were led by with telco (+1.56%), financial services (+1.25%), and energy (+1.22%); while losers were seen in technology (-1.65%), REIT (-0.60%) and transportation & logistics (-0.47%) Market breadth was negative with 640 losers against 476 gainers. Total volume stood at 3.18bn shares valued at RM3.2bn.

Major regional indices trended mostly higher. HSI gained 0.43%, to end at 17,874.67. Nikkei225 rose 0.47%, to finish at 38,288.62. STI added 0.07%, to close at 3,398.47. SHCOMP eased 0.24%, to close at 2,848.73.

Wall Street closed positively as technology led the gainers among sectors. The DJIA rose 0.02%, to end at 41,250.50. Nasdaq added 0.16%, to close at 17,754.82. S&P500 rose 0.16%, to finish at 5,625.70.

News For The Day

RHB Bank’s 2Q net profit down 11%

RHB Bank’s 2QFY24 net profit fell 11% YoY to RM722.3m. The company booked RM145m in allowances for credit losses on financial assets during the quarter. RHB Bank also declared a cash dividend of 15 sen per share, to be paid at a date to be determined later. - The Edge Markets

MPI’s 4QFY6/24 net profit up nearly 11-fold to RM83m

Malaysian Pacific Industries’ 4QFY6/24 net profit jumped nearly 11-fold YoY to RM83m, due to higher revenue from its Asia and Europe market segments, as well as a reversal from its executive share scheme provision during the quarter. However, the group is optimistic that it can benefit from the global demand for electric vehicles (EV), artificial intelligence (AI) chips and data centres. - The Edge Markets

Gas Malaysia posts 12.5% rise in 2QFY24 net profit

Gas Malaysia’s 2QFY24 net profit rose 12.5% YoY to RM110m. The company will continue to take prudent measures to maintain its operational efficiency to remain competitive and seek opportunities to grow its business. Gas Malaysia has declared the first interim dividend of 6.3sen per share which will be paid on Oct 25. - The Star

Kerjaya Prospek expects new orders to surpass RM1.5bn

Kerjaya Prospek Group’s 1HFY24 net profit rose 15.83% to RM70.6m. The company is anticipating stronger construction activities in the 2HFY24 that will further drive its growth. It is optimistic of getting over RM1.6bn of new orders, surpassing its initial target to replenish its order book by RM1.5bn worth of new jobs for FY24. The group is now bidding for RM4bn worth of construction jobs, half of them involving data centres in Klang Valley and Johor. - The Edge Markets

ITMAX System posts 27% higher in 2QFY24 profit

ITMAX System’s 2QFY24 net profit rose 27% YoY to RM19.2m on the back of higher revenue. The group said it is looking to continue its growth by expanding its service offerings and expanding into other geographical territories and segments. - The Edge Markets

Hibiscus’ 4Q earnings down 11.8% YoY

Hibiscus Petroleum’s 4QFY6/24 net profit fell 11.8% YoY to RM108.7m, on the back of equipment impairment and higher expenses. “For FY2025, assuming the acquisition of TotalEnergies Brunei is completed by October 2024, we estimate total sales volume to be approximately 8.6 (m boe) to 8.9 (m boe), an increase of 10% to 14% over FY2024 volumes,” it said. - The Edge Markets

Our Thoughts

Wall Street barely closed positively amid a choppy session as traders are waiting for Nvidia’s earnings to be released later today. As a result, the DJIA was up a mere 10 points while the Nasdaq added 29 points with the US 10-year yield ending at a flattish 3.829%. In Hong Kong, the HSI managed to eke out a 76 point gain spurred by travel-related and EV stocks erasing the sharp decline in tech stocks namely Alibaba and Meituan amid the sharp sell-down on Temu’s parent company PDD Holdings. On the home front, the FBM KLCI surged past the 1,650 mark on the back of continuous inflows of foreign funds that surged by RM1.4bn over the last 7 days. We believe accumulation of blue chips to persist although sentiment of the broader market may be somewhat lacklustre due to the lack of retail participation. We reckon the recent influx of IPOs which topped RM2bn raised for the 1H2024 may be one of the main reasons for the low interest in small caps. Therefore, we expect the index to oscillate between the 1,645-1,655 range today as we enter into the fervor of earnings season for the 3Q2024.

Source: Rakuten Research - 28 Aug 2024

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