Review & Outlook

Bursa Malaysia shares plunged on Monday, following the spillover selloff on global markets from last Friday as investors priced in higher risk for US recession due to the weak July jobs data and Iran's threat of a retaliatory military strike on Israel. The FBM KLCI tumbled 74.57 points, or 4.63%, to close at 1,536.48, off an opening high of 1,593.36 and low of 1,532.24, as losers trashed gainers 1,659 to 83 on strong volume totalling 9.26bn shares worth RM7.97bn.

Given the continuing global markets selloff, further downside volatility can be expected near-term, with the local benchmark index seen to test key chart supports before bouncing back. On a further selloff, look for key retracement supports to hold base, which are at 1,504 and 1,472, the respective 50%FR and 61.8%FR of the rise from June 2023 (1,369 low) to July 2024 (1,638 high), with the 200-day moving average support (1,533) already tested yesterday. Immediate resistance on any oversold rebound attempts will presently be at the 100-day ma (1,588), and then 1,600.

Further selloff on Genting Berhad should attract buyers looking for oversold rebound ahead, with key chart supports at the Oct 2023 lows (RM4.00) and Nov 2022 low (RM3.80) capping downside, and overhead resistance seen at the 50%FR (RM4.52), 61.8%FR (RM4.66) and 76.4%FR (RM4.83). Likewise, Genting Malaysia will be very attractive to bargain on further selloff, with crucial supports seen at the Oct 2023 (RM2.30) and Nov 2022 (RM2.20) lows, and upside hurdles on oversold rebound viewed at the 38.2%FR (RM2.52), 50%FR (RM2.58) and 61.8%FR (RM2.65).

News Bites

• FGV Holdings Bhd has launched the FGV Vendor Development Program to empower 300 local vendors and foster local economic growth in Malaysia.

• Mah Sing Group Berhad announced that it has completed the acquisition of the 500-acre M Legasi freehold township in Semenyih. M Legasi is anticipated to have a gross development value of RM3.3bn.

• The High Court of Kuala Lumpur has ordered Ireka Corporation Bhd to pay RM6.5mn plus costs to RHB Bank Bhd over subsidiary's payment default.

• Berjaya Food International, the international arm under Berjaya Food Bhd, has been granted the rights to operate its Starbucks stores in Iceland, Denmark and Finland.

• Jati Tinggi Group Bhd has accepted a letter of award from Gamuda Engineering Sdn Bhd worth RM33.8mn to perform engineering, procurement, construction and commissioning of horizontal directional drilling works for incoming power supply in Gombak, Selangor.

• Handal Energy Bhd said a firm in which its group managing director Sunildeep Singh Dhaliwal is a substantial shareholder is suing the offshore crane services provider over an alleged unpaid payment of RM9.6mn.

• Sasbadi Holdings Bhd has secured two contracts from the Ministry of Education to supply reprinted textbooks to schools, worth an estimated RM11.7mn.

• Talam Transform Bhd has proposed to dispose of a piece of commercial leasehold land measuring 27.7 acres in Sepang to IJM Properties Sdn Bhd.

• Plytec Holding Bhd has secured multiple sales contracts with a combined value of RM22.1mn.

• Malayan Banking Bhd has appointed Chiam Sou Hong and Vittorio Furlan as independent non-executive directors effective Aug 5, 2024.

• MISC Bhd has appointed Zahid Osman as its executive director, president and group chief executive officer with effect from Aug 16, 2024.

• Notion VTec Bhd logged an eleven-fold increase in net profit for 3QFY24 to RM20.3mn from RM1.8mn a year earlier, on the back of higher revenue.

• China's Caixin/S&P Global services purchasing managers' index rose to 52.1 from 51.2 in June, pointing to expansion for the 19th straight month.

• The US Institute for Supply Management said on Monday that its nonmanufacturing purchasing managers index increased to 51.4 last month from 48.8 in June, which was the lowest level since May 2020.

Source: TA Research - 6 Aug 2024