Previous Day Highlights

The FBM KLCI ended the day on a higher note, buoyed by the positive momentum carried over from

Wall Street. The benchmark index was up 0.33% or 5.43 pts to close at 1,641.97. Gainers were seen in property (+2.51%), financial services (+0.81%), and plantation (+0.66%); while losers were seen in energy (-2.44%), utilities (-1.46%), and technology (-0.21%). Market breadth was negative with 558 losers against 509 gainers. Total volume stood at 2.87bn shares valued at RM2.77bn.

Major regional indices trended mixed. HSI declined 3.7% to close at 20,318.79. SHCOMP slid 2.5%, to close at 3,201.29. Nikkei 225 was up 0.8% to close at 39,910.55. STI closed flat at 3,595.47. Wall Street closed lower amid weak outlook from Europe's leading tech firm and concerns over tighter US chip sale restrictions. The DJIA dropped 0.75%, to end at 42,740.42. Nasdaq eased 1.01%, to close at 18,315.59. S&P500 eased 0.76%, to finish at 5,815.26.

News For The Day

AirAsia, AAX aviation biz to see 15% cost reduction

Capital A is expected to achieve a 15% cost reduction upon completion of its merger with the long-haul low-cost carrier under its sister company AirAsia X. Cost reduction, coupled with more flight frequencies, will likely translate into lower ticket prices for passengers. By FY25, the low-cost airline plans to increase its operational fleet by 21% from 63 to 76 aircrafts, to support the 12% growth in daily flights and boost its network by adding eight new destinations. - The Edge Markets

Infomina's 1QFY5/25 net profit up 10%

IT services firm Infomina 1QFY5/25 net profit grew 10.25% YoY despite a drop in revenue, thanks to a higher gross profit margin. The company did not declare any dividend for the quarter. Infomina said advancements in the information technology industry are expected to continue driving its growth trajectory in the mainframe, cybersecurity and artificial intelligence (AI) segment. The company said it will also leverage its AI-powered solutions to foster enhanced data access and analysis for business and financial institutions. - The Edge Markets

Cypark inks MoA for German Technology Park

Cypark Resources has inked a memorandum of agreement (MOA) with Melaka Corp (MCORP) and Jakel Capital to jointly explore and develop energy solutions for the German Technology Park (GTP) in Melaka. The development will utilise Cypark's expertise in renewable energy to ensure the park's energy needs are met with sustainable practices. - The Edge Markets

UUE records 10.5% revenue growth for 2QFY2/25

UUE Holdings 2QFY2/25 net profit increasing by 21.2% QoQ to RM6.7m. Revenue was driven mainly by its manufacturing and trading of high-density polyethylene (HDPE) pipes segment. - The Edge Markets

PLB Engineering disposes of 60% stake

PLB Engineering via its subsidiary PLB Terang had signed a share sale agreement to dispose of its 60% stake in PLB Green Solar. The purchase price represents a premium of RM 30.8m or 1,370.34% to the audited net assets of PLBGS. The proposed disposal marks the exit by PLB from the business of provision of solar energy services to enable PLB to realign its strategies and focus on property development. - The Star

Our Thoughts

Wall Street closed lower as US stocks took a breather following the recent rally as traders are analyzing recent earnings reports. As such, the DJIA lost 325 points while the Nasdaq declined by 187 points as the US 10-year yield eased slightly to 4.034%. Meanwhile, the Hong Kong market closed sharply lower as the HSI ended near the 20,000 threshold following China’s weak economic data underscoring the need for more stimulus to prop up the Chinese domestic demand. Back home, the FBM KLCI managed to close higher after a choppy session attributed to late buying activities. Market undertone remained cautious as defined by the low volume traded at below the 3bn shares level. In the absence of any positive catalysts, we expect the index to hover within the 1,635-1,645 range today. Meanwhile, crude oil prices continued to weaken on concerns over demand as the Brent crude is currently trending at USD74/barrel.

Source: Rakuten Research - 16 Oct 2024

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