Review & Outlook

Stocks traded sideways on Wednesday with most sectors in consolidation, but the construction sector rose 1.7% given positive news flow on land sales and optimism over infrastructure contracts. The FBM KLCI added 3.96 points to settle at 1,618.38, off an opening low of 1,613.65 and high of 1,620.83, as gainers edged losers 569 to 549 on total turnover of 4.76bn shares worth RM3.71bn.

Market sentiment should stay upbeat with recent news flow boosting the construction and utility sectors on data centre deals, supported further by optimism over future US interest rate cuts due to easing inflation expectations. Immediate index resistance remains at the early June high of 1,622, with the May high of 1,632 and 1,640 as tougher upside hurdles, while immediate supports are at 1,602, 1,595 and 1,571, the respective 30-day, 50-day and 100-day moving average levels.

Duopharma will need breakout confirmation above the 50%FR (RM1.32) to boost upside momentum towards the 61.8%FR (RM1.40) and 76.4%FR (RM1.48) ahead, while the 200-day ma (RM1.21) provides strong support cushion. Pharmaniaga need to overcome the 50%FR (45sen) convincingly to enhance upside momentum and aim for the 61.8%FR (51sen) and 76.4%FR (58sen) going forward, with the 23.6%FR (33sen) expected to cushion downside risk.

News Bites

• Malaysia's unemployment rate remained unchanged at 3.3% in May.

• Negotiations for the Johor-Singapore Special Economic Zone are in their final stages, paving the way for a joint agreement expected to be signed in September this year, said Economy Minister Rafizi Ramli.

• QL Resources Bhd has proposed to undertake a bonus issue of up to 1.2bn shares on the basis of 1 bonus share for every 2 existing shares held, to reward shareholders.

• Genting Malaysia Bhd's subsidiary GENM Capital Bhd has made an early redemption of RM1.3bn in nominal value from its RM2.4bn medium term notes.

• Solarvest Holdings Bhd has appointed Daniel Ruppert as chief investment officer effective 1 July 2024.

• Econpile Holdings Bhd received a Letter of Award for jobs worth RM26.5mn from SNA Consult Sdn. Bhd. for and on behalf of Modern Plus Sdn. Bhd. to undertake civil works for a 40-storey condominium project in Mont Kiara.

• PTT Synergy Group Bhd is disposing of 2 units of 3-storey detached factories in Sepang, Selangor, to MCM Land Sdn Bhd for RM26.0mn.

• The Human Resource Development Fund has acquired Widad Group Bhd shares, which tanked from 62.0sen to 6.0sen, under a put and call option arrangement, according to the briefing notes on the findings by the National Audit Department on 9 July 2024.

• LFE Corporation Bhd has bagged a contract worth RM14.7mn as a sub-contractor for air conditioning, mechanical ventilation, and building management system services.

• Loss-making MUI Properties Bhd, in which Malayan United Industries Bhd owns a 23.5% stake, is selling 53 acres of freehold land in Port Dickson, Negeri Sembilan, for RM80.8mn cash.

• Haily Group Bhd plans to reward its shareholders with a bonus issue of 1 new share for every share held.

• The Securities Commission Malaysia has filed a civil suit against Sabah businessman Datuk Raymond Chan Boon Siew for alleged insider trading involving the shares of Naim Indah Corp Bhd, now known as Pegasus Heights Bhd.

• Annum Bhd has secured a RM53.2mn sub-contract from Kacon Construction Sdn Bhd.

• Eurospan Holdings Bhd has declared a special dividend of 20.0sen/ share for FY25 ending 31 May 2025.

• Scomi Energy Services Bhd has decided not to proceed with the regularisation plan it announced in January.

• Sorento Capital Bhd has secured approval from Bursa Malaysia for an IPO on the ACE Market.

• Vanzo Holdings Bhd, an air fragrance maker, filed for an IPO on ACE Market to raise funds.

• Wawasan Dengkil Holdings Bhd, a construction services company, filed for an IPO on the ACE Market to raise funds.

• Azam Jaya Bhd, a Sabah-based construction company, filed for an IPO on the Main Market of Bursa Malaysia to raise funds.

• China's consumer price index in June rose 0.2% YoY, against a 0.3% uptick in May, the slowest in three months.

• The Organization of the Petroleum Exporting Countries, in a monthly report, said world oil demand would rise by 2.25mn barrels per day in 2024 and by 1.85mn bpd in 2025.

Source: TA Research - 11 Jul 2024