Review & Outlook

Blue chips closed higher on Monday, underpinned by mild buying interest from local funds on selected blue-chip heavyweights amidst the more cautious broader market, while key regional markets rose as investors react to stronger than expected US jobs growth data that eased concerns about the economic outlook. The FBM KLCI gained 5.32 points to close at 1,635.29, off an early low of 1,628.12 and high of 1,637.29, as gainers led losers 548 to 476 on total turnover of 2.76bn shares worth RM2.74bn.

While market tone is lifted by improved outlook for the US economy following strong jobs growth last month, lingering worries over escalating tensions between Israel and Hezbollah and lack of positive local catalysts should continue to cloud sentiment. Immediate index support will be the recent correction low of 1,625, with 1,620 and then 1,600 acting as stronger supports. Immediate resistance is set at 1,660, followed by the recent highs of 1,675 and 1,684, and then 1,695, the Dec 2020 high, as tougher resistance levels.

Any further weakness on AMMB shares to the 100-day ma (RM4.58) or the 200-day ma (RM4.30) should attract buyers looking for rebound upside towards the 161.8%FP (RM5.45), with next resistance seen from the 176.4%FP (RM5.66). Similarly, selling dips on Maybank shares towards the 100-day ma (RM10.02) should encourage bargain hunting ahead of recovery upside towards the 161.8%FP (RM11.07) or 176.4%FP (RM11.37), while stronger retracement support is at the 200-day ma (RM9.51).

News Bites

• Malaysia's latest international reserves totalled US$119.7bn, the most since Dec 15, 2014, compared with US$117.6bn as at Sept 13.

• Aurora Mulia Sdn Bhd, a company linked to tycoon Tan Sri Syed Mokhtar Al-Bukhary, has sold its entire 31.9% stake in Media Prima and exited after five years as the largest shareholder in the media group.

• HeiTech Padu Bhd has terminated its agreement to acquire a 30% stake in Souqa Fintech Sdn Bhd, less than two weeks after entering into the share subscription agreement.

• Tuju Setia Bhd's JV company has secured a RM317.6mn contract to build a new block at Gleneagles Hospital in Jalan Ampang.

• Uzma Bhd said its maiden 50MW LSS4 project located in Sungai Petani, Kedah has reached its commercial operation date on Sept 25.

• Dayang Enterprise Holdings Bhd has secured order awards from Petronas Carigali Sdn Bhd for six accommodation work boats.

• Hibiscus Petroleum Bhd has completed the farm-in arrangement with Petronas Carigali Sdn Bhd to acquire a 30% participation interest in the PM327 production sharing contract.

• ITMax System Bhd's subsidiary, Southmax Sdn Bhd has been appointed by Muar Municipal Council as the smart parking operator, managing 8,650 street parking bays in the Muar district.

• Sapura Resources Bhd said its managing director Datuk Shahriman Shamsuddin has been placed on a leave of absence effective Sept 11, pending ongoing investigations, confirming a report in The Edge Malaysia weekly.

• Dialog Group Bhd's chief operating officer Mustaffa Kamal Abu Bakar has been promoted to chief executive officer, effective Monday.

• Ramssol Group Bhd has been appointed as the authorised business partner for sales and marketing activities for a Singapore-based company.

• HE Group Bhd, which debuted on the ACE Market in January, has proposed a special issue of 45.6mn new shares or 9.4% of its enlarged share capital to meet its Bumiputera equity condition.

• Sorento Capital Bhd, a provider of bathroom and kitchen sanitary ware solutions, is set to raise RM57.4mn through its initial public offering and plans to recruit 200 new dealers across Malaysia over the next three years.

• ACE Market-bound Northeast Group Bhd's issue of 37.0mn shares to the public has been oversubscribed by 73.4 times, according to the Malaysian Issuing House Sdn Bhd.

• China's top economic planner will hold a press briefing today to discuss a package of policies aimed at boosting economic growth.

• The Bank of Japan said broadening wage hikes were underpinning consumption and prodding more firms in regional areas to pass on rising labour costs, signalling the economy was making progress towards meeting the prerequisite for more interest rate hikes.

Source: TA Research - 8 Oct 2024