Review & Outlook

The local blue-chip benchmark bounced back to trade at fresh three-year highs on Wednesday, boosted by the overnight rally on the US Dow Jones average to record highs as traders were more certain the Fed will pivot to interest rate cuts soon. The FBM KLCI ended up 7.58 points at 1,633.54, off an opening low of 1,629.89 and high of 1,638.03, as gainers led losers 770 to 445 on higher turnover of 5.28bn shares worth RM3.88bn.

Buying momentum surge will be crucial to absorb profit-taking and sustain the index's rise to three-year highs, with situational plays on the construction and property sectors seen to drive positive market tone. Immediate index resistance will be at yesterday's high of 1,638, with 1,640 and 1,660 as tougher upside hurdles, while immediate supports are at 1,620, 1,609 and 1,601, the respectively rising 10-day, 30-day and 50-day moving average levels.

Hartalega will need to overcome the 138.2%FP (RM3.68) to enhance upside momentum and aim for the 150%FP (RM3.87) and 161.8%FP (RM4.07) ahead, while uptrend supports from the rising 50-day ma (RM3.32) and 100-day ma (RM2.98) cushion downside. Kossan need breakout confirmation above the 138.2%FP (RM2.59) to extend uptrend momentum and target the 150%FP (RM2.71) and 161.8%FP (RM2.83) going forward, with the 50-day ma (RM2.37) and 100-day ma (RM2.17) acting as uptrend supports.

News Bites

• PGF Capital Bhd has entered a deal to serve as the Malaysian distributor of a Chinese company's mineral wool sandwich panels, which are suitable for wall facades in data centres.

• Hong Seng Consolidated Bhd's wholly owned subsidiary HS Green Valley Sdn Bhd has entered into an agreement to acquire all of Hong Seng Frontier Sdn Bhd for RM45.3mn from Velocity Capital Partner Bhd.

• Rooftop solar power system provider ILB Group Bhd is acquiring Armani Sinar Sdn Bhd, a solar energy company, and its assets for RM98.0mn, cash.

• Bintai Kinden Corp Bhd, through its subsidiary Kejuruteraan Bintai Kindenko Sdn Bhd, has clinched two contracts totalling RM25.7mn.

• PTT Synergy Group Bhd is acquiring two parcels of land with semidetached factories in Selangor from Sime Darby Property Bhd for RM22.0mn, cash.

• BIG Industries Bhd has announced the cessation of its concrete business division, in a bid to mitigate losses.

• Synergy House Bhd received an unusual market activity query from Bursa Malaysia on Wednesday after its shares suffered their biggest daily fall since being listed more than a year ago.

• Econpile Holdings Bhd said Retirement Fund Inc has ceased to be a substantial shareholder in the piling and foundation specialist.

• Penang-based property developer Ewein Bhd's shares will be traded under its new name, Skygate Solutions Bhd, effective tomorrow.

• Scomi Energy Services Bhd has applied for a six-month extension until January 31, 2025, to submit its regularisation plan to exit Practice Note 17 status.

• Pavilion Real Estate Investment Trust's net property income increased 18.8% YoY in the 2QFY24 to RM120.3mn against RM101.0mn a year ago.

• Zhulian Corp Bhd's net profit for the 2QFY24 dipped to RM6.6mn from RM9.5mn in the previous corresponding period and expects its current financial year to remain challenging amid inflationary pressure.

• Singapore's non-oil domestic exports declined by 8.7% YoY in June, after May's 0.7% decrease.

• The US industrial production rose 0.6% in June, which followed a revised 0.9% gain a month earlier, marking the biggest two-month advance since late 2021.

Source: TA Research - 18 Jul 2024