Review & Outlook

Bursa Malaysia shares rose on Monday, with utility, construction and telco heavyweights leading gains on lessening worries over the global economy and investor focus on domestic investment themes. The FBM KLCI was up 10.61 points to close at 1,606.66, off an opening high of 1,598.53 and low of 1,609.57, as gainers led losers 646 to 406 on total turnover of 4.01bn shares worth RM2.92bn.

Stocks should be in a holding pattern following the strong recovery from last Monday's selloff, as investors look to take profits or reduce exposure and await more solid signs of sustained recovery momentum on the global front. Immediate index supports are revised to 1,580, then 1,550 and recent low of 1,529, with 1,520 and 1,500 as stronger supports, while immediate resistance will be at 1,620, 1,628 and then 1,638.

Following the recent strong rebound, Axiata will still need to overcome the 38.2%FR (RM2.50) to aim for the 50%FR (RM2.60) and 61.8%FR (RM2.70) ahead, with downside risk capped by the 31/10/23 pivot low (RM2.12). Likewise, CelcomDigi will need to convincingly break above the 61.8%FR (RM3.88) to target the 76.4%FR (RM4.08) and 30/5/23 high (RM4.42) going forward, while downside is cushioned by the 23.6%FR (RM3.34).

News Bites

• Malaysia construction sector recorded a 20.2% surge to RM38.9bn in work done value in the 2Q24, spearheaded by the buoyant performance of the civil engineering and residential buildings sub-sectors.

• Malaysia's palm oil exports surged 39.92% to 1.69mn tonnes in July 2024 from 1.21mn tonnes in June 2024, according to the Malaysian Palm Oil Board.

• Encorp Bhd where Felda Investment Corp Sdn Bhd holds a 67.13% stake, has suspended its Group Chief Executive Officer, Hazurin Harun, to facilitate an internal investigation related to allegations involving the Malaysian Anti-Corruption Commission.

• Mikro MSC Bhd plans to acquire TES Productions & Projects Pte Ltd, a Singapore-based sign and advertising display manufacturer, for RM 30mn in shares.

• Petroliam Nasional Bhd has launched a supplier support programme to encourage Malaysia's oil and gas services and equipment suppliers to adopt sustainability principles.

• Maxis Bhd and Huawei Technologies (Malaysia) Sdn Bhd have announced a strategic partnership to establish a joint innovation centre focused on the development of 5G-advanced technology.

• Icon Offshore Bhd is fully cooperating with the relevant authorities with regards to the explosion that occurred on its vessel, the Icon Amara, which resulted in two fatalities and one serious injury.

• Straits Energy Resources Bhd is proposing to list its 76.68%-owned subsidiary TMD Energy Ltd on the New York Stock Exchange American.

• HSS Engineers Bhd's associate HSS Integrated Sdn Bhd has secured an estimated RM10.3mn contract to provide project construction management services to Yellowwood Properties Sdn Bhd for a new data centre campus in Sedenak Tech Park in Kulai, Johor.

• Censof Holdings Bhd has secured a RM14.6mn contract from the Penang Development Corp to provide an enterprise-wide financial management information system.

• Pekat Group Bhd has secured a RM 21.8mn contract from Gamuda Engineering Sdn Bhd to install earthing and lightning protection at a data centre.

• Kumpulan Kitacon Bhd has secured a RM 111.2mn contract from Sime Darby Property (Bukit Raja) Sdn Bhd for the construction of factories and industrial facilities in Klang, Selangor.

• The Employees Provident Fund has become a substantial shareholder in SMRT Holdings Bhd for the first time, increasing its stake to 5.017%, or 22.7mn shares.

• Loh Chen Yook, chairman of Karyon Industries Bhd and independent non-executive director of Enra Group Bhd, has become a substantial shareholder in Sycal Ventures Bhd.

• MSM Malaysia Holdings Bhd has appointed Nur Izwan Mohd Nawawi as the officer-in-charge on an interim basis from Aug 12, 2024, following the resignation of the company's chief financial officer.

• Carlo Rino Group Bhd has received approval from Bursa Malaysia for its transfer from the LEAP Market to the ACE Market.

• Well Chip Group Bhd reported a net profit of RM 14.3mn in the 2QFY24, marking a 20% increase from RM11.9mn in the first quarter.

• China's direct investment liabilities in its balance of payments dropped almost US$15bn in the April-June period, marking only the second time this figure has turned negative.

• The US budget deficit exceeded $1.5tn with two months to go until the end of the fiscal year, down slightly from 2023.

Source: TA Research - 13 Aug 2024