Review & Outlook

Stocks fell for profit-taking consolidation on Thursday, due to overbought momentum after rising for six straight trading days and caution ahead of closely watched 1Q GDP data for the US. The FBM KLCI slid 2.23 points to settle at 1,569.25, off an early high of 1,574.45 and low of 1,569.03, as losers beat gainers 581 to 443 on slower turnover of 3.96bn shares worth RM2.83bn.

The local market should fall for profit-taking correction ahead of the weekend, given the still overbought technical momentum and overnight fall on Wall Street following the sharply weaker 1Q GDP reading. Immediate resistance for the index remains at 1,580, with stronger upside hurdles seen at 1,600 and then 1,620. Key supports will be at 1,547, 1,539 and 1,517, the respective rising 30-day, 50-day and 100-day moving averages.

Positive technical momentum on Public Bank support further upside bias towards the 76.4%FR (RM4.34), with tougher upside hurdles seen at the Feb high (RM4.52) and 123.6%FP (RM4.69), and key retracement support from the 38.2%FR (RM4.06). Sime Darby will need confirmed breakout above the 123.6%FP (RM2.89) to extend uptrend towards the 138.2%FP (RM3.00) and 150%FP (RM3.09) ahead, with uptrend supports from the rising 50-day ma (RM2.66) and 100-day ma (RM2.54) cushioning downside.

News Bites

• Malaysia's consumer price index rose 1.8% YoY in March.

• Malaysia requires an annual allocation of at least RM10bn for the next three years, which is crucial to boost water infrastructure amid belowcost tariffs and high wastage, said the National Water Services Commission.

• The Employees Provident Fund members, who are below 55 years old, will have an Account 3, in addition to the existing two accounts for their retirement savings, starting May 11.

• Al-'Aqar Healthcare Real Estate Investment Trust is actively targeting to acquire yield-accretive properties from KPJ Healthcare Bhd as part of its asset expansion plan.

• Pantech Group Holdings Bhd is considering to list 2 wholly-owned subsidiaries - Pantech Stainless & Alloy Industries Sdn Bhd and Pantech Steel Industries Sdn Bhd - on the Main Market of Bursa Malaysia via a special purpose vehicle.

• AirAsia X Bhd, which will be taking over Capital A Bhd's aviation business, has announced the mechanics of its plan via a bourse filing on Thursday.

• Inta Bina Group Bhd has been awarded a contract from Tropicana Metropark Sdn Bhd to construct and complete main building works for a serviced apartment project for RM224.8mn.

• Khee San Bhd will increase the allotment underwritten in its proposed rights issue after Ng Meng Kee ceased to be a substantial shareholder and requested to discharge his undertaking.

• Infoline Tec Group Bhd has proposed to transfer its listing from the ACE Market to the Main Market of Bursa Malaysia as it has met the profit requirements for the transfer.

• Heineken Malaysia Bhd has nominated Martijn Rene van Keulen as its new managing director.

• Agricore CS Holdings Bhd, a food ingredients supplier, has obtained approval from Bursa Malaysia Securities Bhd to list on its ACE Market.

• Pavilion Real Estate Investment Trust 1QFY24 net property income jumped 33.2% YoY, thanks largely to contribution from its newly acquired mall, Pavilion Bukit Jalil.

• ViTrox Corporation Bhd net profit fell 47.8% YoY to RM17.2mn for the 1QFY24, primarily due to unfavourable product mix and higher research and development expenditures to support the introduction of new products.

• Atlan Holdings Bhd net profit fell over 42.1% YoY to RM5.1mn in 4QFY24 as increased revenue was more than offset by higher operating expenses, depreciation and amortisation, as well as finance costs.

• Chin Teck Plantations Bhd 2QFY24 net profit surged seven-fold to RM20.8mn thanks to higher palm oil production as well as lower operating and administrative expenses.

• Luxchem Corporation Bhd 1QFY24 net profit surged over 54.0% YoY to RM11.6mn on the back of stronger earnings from both its trading and manufacturing segments.

• TAS Offshore Bhd's net profit leapt by nine-fold YoY to RM6.1mn for the 3QFY24 due to more vessels delivered.

• The US GDP increased at a 1.6% annualised rate in 1Q24.

Source: TA Research - 26 Apr 2024