Review & Outlook

The local blue-chip benchmark index stayed range bound on Tuesday as profit-taking on telco and plantation heavyweights checked gains in construction, technology and energy stocks. The FBM KLCI ended flat at 1,597.96 (-0.24), off an early high of 1,602.52 and low of 1,595.62, as gainers led losers 715 to 459 on stronger trade which totalled 5.39bn shares worth RM3.99bn.

Range bound trade should prevail, pending more solid positive domestic cues to lift the market from the current trading range. Immediate index resistance will be the early June high of 1,622, with the May high of 1,632 and 1,640 as tougher upside hurdles, while stronger supports are at 1,567, the 100-day moving average level, followed by 1,550.

Globetronics need to overcome the 61.8%FR (RM1.51) to enhance upside momentum towards the 76.4%FR (RM1.63), with next hurdle seen at the 18/12/23 high (RM1.83), while good support is available from the 38.2%FR (RM1.31). Inari will need decisive breakout above the 150%FP (RM3.95) to fuel further upside towards the 161.8%FP (RM4.09) and 176.4%FP (RM4.26) ahead, with uptrend support from the rising 30-day ma (RM3.53) cushioning downside.

News Bites

• Micro, small and medium enterprises that are earning less than RM150,000 annually are not required to issue e-invoices, says Finance Minister II Datuk Seri Amir Hamzah Azizan.

• Sunway Group is selling two parcels of land measuring 64 acres in Sunway City Iskandar Puteri, Johor, in a deal worth over RM380mn for data centre development.

• Bank Islam Malaysia Bhd and Waqaf An-Nur Corporation have signed a collaboration agreement to expand support for micro-entrepreneurs in the country.

• Pertama Digital Bhd has secured a contract to provide public online digital identity onboarding registration services for the national digital ID platform, MyDigital ID.

• Reservoir Link Energy Bhd has completed solar projects totalling more than 1.5 gigawatts since its diversification into the solar renewable energy segment in 2021, via the acquisition of Founder Energy Sdn Bhd.

• KNM Group Bhd said it is considering fresh options to sell its Italian subsidiary, FBM Hudson Italiana SpA, following a third failed attempt.

• AEON Co (M) Bhd is planning to raise up to RM2bn via two separate sukuk programmes that it is setting up, to fund its capital expenditure, working capital, investments and refinance existing debts.

• Malton Bhd said it is acquiring 30.2 acres of freehold land in Genting Highlands for RM65mn from fellow property developer Global Oriental Bhd to build serviced apartments and luxury villas.

• G Capital Bhd has decided to scrap its planned rights issue of redeemable convertible unsecured loan stocks due to unfavourable market conditions.

• Main Market-bound Johor Plantations Group Bhd's net profit for the 1QFY2024 more than doubled to RM50mn from RM23.4mn a year earlier, as revenue for the quarter rose to RM294.9mn versus RM252mn previously.

• Indonesia is preparing to impose tariffs and use other means to protect its textile industry from imports from China.

• The US central bank still needs more data before cutting interest rates to ensure that recent weaker inflation readings give a true picture of what is happening to underlying price pressures, Federal Reserve chair Jerome Powell said.

• US job openings, a measure of labour demand, rose 221,000 to 8.140mn on the last day of May.

Source: TA Research - 3 Jul 2024