Review & Outlook

Stocks extended profit-taking for third day on Wednesday, but the technology sector (+2.1%) outperformed on optimism over recent data centre deals. The FBM KLCI lost another 2.54 points to end at the day's low of 1,608.95, off an early high of 1,618.99, as losers beat gainers 758 to 550 on higher trading volume totalling 7.59bn shares worth RM5.28bn.

Blue chips should stay range bound as investors assess regional inflation data and the US FOMC statement on interest rates, while situational plays on lower liners takes profit-taking breather. Immediate index supports are at 1,602, the rising 30-day moving average, with 1,588 and 1,558, the respective 50-day and 100-day moving averages, acting as stronger supports. Immediate resistance remains the recent high of 1,632, with 1,640, 1,660 and then 1,680 as tougher upside hurdles.

Aemulus will need breakout from consolidation to challenge the 38.2%FR (42sen), with a successful breakout to aim for the 50%FR (47sen) and 61.8%FR (53sen) going forward, while supports from the 100-day ma (34sen) and 200-day ma (32sen) cushion downside. UEM Sunrise need confirmed breakout above the 150%FP (RM1.30) to target the 161.8%FP (RM1.38) and 176.4%FP (RM1.48) ahead, with uptrend supports seen at the 50-day ma (RM1.13) and 100-day ma (RM1.08).

News Bites

• Malaysia Airports Holdings Bhd said it was notified on Wednesday that one of the four pre-conditions for the RM10.8bn proposal to privatise the airports operator has been fulfilled.

• DRB-Hicom Bhd's 50.1%-unit Perusahaan Otomobil Nasional Sdn Bhd is planning to launch 5 electric vehicle models that use the Global Modular Architecture platform under its newly launched EV brand, Proton e.MAS.

• Boustead Heavy Industries Corp Bhd has secured a RM1.1bn contract from the Ministry of Defence to provide in-service support 2 performance for the Royal Malaysian Navy's prime minister class submarines.

• YNH Property Bhd has appointed UHY as a special independent reviewer to assess certain joint venture and turnkey contracts entered into by its unit, Kar Sin Bhd.

• Petra Energy Bhd has secured a letter of award from Petroliam Nasional Bhd in relation to the Banang Late Life Asset Production Sharing Contract for a 10-year period until 1 June 2034.

• HSS Engineers Bhd's associate, SMHB Sdn Bhd, has agreed to conduct engineering consultancy services for the phase one construction project of the Sungai Karangan water treatment plant in Kulim, Kedah, with an estimated service value of RM20.9mn.

• Ecoscience International Bhd has secured a RM61.8mn contract from Oiltek Sdn Bhd for the EPCC of civil and structural works of a crude palm oil pretreatment plant and a plant, machinery, and equipment plant, along with auxiliary buildings in Port Dickson.

• LYC Healthcare Bhd has dropped the plan to list its subsidiary LYC Medicare Singapore Ltd on the Singapore Exchange, less than 3 months after it filed the preliminary offer document with the exchange.

• Iqzan Holding Bhd has secured a construction project worth approximately RM143mn via its subsidiary, Kacon Construction Sdn Bhd.

• Johor Plantations Group Bhd's initial public offer on the Main Market of Bursa Malaysia is expected to raise a total of RM735mn, of which approximately RM345.2mn will be raised via an offer for sale of 411mn existing shares.

• Go Hub Capital Bhd launched its IPO 35 sen per share that will raise RM37.5mn for its listing on the ACE Market.

• Frozen seafood processor Ocean Fresh Bhd began taking orders for its IPO exercise at 28 sen per share that aims to raise up to RM14.0mn ahead of its listing on the ACE Market.

• China's consumer price index rose 0.3% YoY in May, matching a gain in April but below a 0.4% increase forecast in a Reuters poll.

• The US Federal Reserve maintained interest rate between 5.25% and 5.50%, and penciled in just one interest-rate cut this year compared to three previously but forecast four cuts for 2025 versus three before.

• The Consumer Price Index in the US declined to 3.3% YoY in May from 3.4% in April.

Source: TA Research - 13 Jun 2024