Review & Outlook

Blue chips closed mixed on Thursday, with profit-taking capping the index's rise to a three-year high, while the construction, property, transport and logistics sectors continue to attract buying interest. The FBM KLCI ended flat at 1,633.81 (+0.27) after oscillating between early high of 1,634.24 and low of 1,627.93, as losers beat gainers 727 to 499 on steady turnover of 5.48bn shares worth RM4.22bn.

The local market should pause for profit-taking breather ahead of the weekend, with trading focus on the construction, property and logistics sectors given the continuing keen interest in data centre and infrastructure plays. Immediate index resistance remains at the recent high of 1,638, with 1,640 and 1,660 as tougher upside hurdles, while immediate supports are at 1,622, 1,611 and 1,602, the respectively rising 10-day, 30-day and 50- day moving average levels.

A confirmed breakout on Gadang shares above the 150%FP (52sen) will extend uptrend to target the 161.8%FP (54sen), 176.4%FP (56sen) and 200%FP (60sen) ahead, while the rising 50-day ma (45sen) and 100-day ma (43sen) cushion downside. IWCity will need convincing breakout above the 76.4%FR (90sen) to boost upside momentum and aim for the 8/1/24 peak (RM1.03) and 123.6%FP (RM1.16) going forward, while key support from the 200-day ma (74sen) limits downside risk.

News Bites

• Malaysia's exports grew 1.7% YoY to RM126.05bn in June, at a much slower than expected pace of 3.3% YoY, driven largely by shipments of machinery and natural gas.

• Malaysia will decide in the coming months whether to proceed with a multibillion-dollar high-speed rail line between Kuala Lumpur and Singapore, as Prime Minister Datuk Seri Anwar Ibrahim's government weighs proposals from a narrowing list of private consortiums, says the Transport Minister Anthony Loke.

• Gamuda Bhd's joint venture with French rail engineer Alstom SA in Australia has secured a contract worth AUD1.6bn for the supply and maintenance of a new automatic train control system on Perth's suburban rail networks.

• A planned sale and purchase agreement between Sarawak and Affin Bank Bhd's biggest shareholder - the Armed Forces Fund Board - has been delayed, sources said.

• Haily Group Bhd has secured a RM76.7mn contract to construct 171 units of link houses in Kempas Baru, Johor Bahru.

• Sunview Group Bhd has entered into a heads of terms agreement with Uzbekistan to develop solar photovoltaic power plants and a battery storage energy system.

• T7 Global Bhd said the High Court has ruled in favour of its whollyowned unit Tanjung Offshore Services Sdn Bhd in its dispute with consortium partner VME Process Systems Malaysia Sdn Bhd and ordered the latter to refund the USD5.5mn as per the statement of claim.

• AmanahRaya Real Estate Investment Trust has signed a 18-year longterm tenancy agreement with Alfa International College Sdn Bhd for its property in Subang Jaya.

• Samaiden Group Bhd has established multi-currency sustainability sukuk Wakalah programmes of RM1.5bn in total as part of its strategic financial initiative to support growth and sustainability.

• Sarawak Consolidated Industries Bhd said it has secured Islamic banking facilities worth RM70mn from SME Bank.

• Sapura Resources Bhd's wholly-owned subsidiary Sapura Aero Sdn Bhd has entered into a memorandum of understanding with MRO Sdn Bhd to establish a joint venture to provide aircraft and other aviationrelated services.

• Ancom Nylex Bhd's net profit for its 4Q24 grew 1.4% to RM18.4mn from RM18.2mn a year ago while revenue increased 1.8% to RM487.0mn from RM478.3mn.

• Well Chip Group Bhd, which is set to be listed on the Main Market of Bursa Malaysia next Tuesday, said its net profit for the 1Q24 came in at RM11.9mn.

• Initial claims for state unemployment benefits in the US increased 20,000 to a seasonally adjusted 243,000 for the week ended July 13.

• The European Central Bank kept interest rates unchanged as expected on Thursday, with its president Christine Lagarde saying a move in September was "wide open".

Source: TA Research - 19 Jul 2024