Overnight US Rebound to Revive Local Market

Bursa Malaysia shares traded sideways on Monday, with investors flocking to safe haven assets as cautious sentiment prevailed amid the ongoing conflict between Iran and Israel. The FBM KLCI rose 1.88 points to close at 1,519.99, off an early low of 1,512.26 and high of 1,521.38, as losers crowded gainers 613 to 321, on moderate trade totaling 2.84bn shares worth RM2.05bn.

Support at 1,490/1,465; Resistance at 1,564/1,586

The overnight rebound on Wall Street should revive the local market today, but market undertone remains cautious amid ongoing tensions in the Middle East. Immediate index support is kept at 1,490, while stronger supports can be found at 1,465 and 1,444. Immediate resistance stays at 1,564 with next upside hurdles seen at the recent high of 1,586, followed by 1,610 ahead.

Bargain Dialog and Velesto

Dialog needs decisive breakout above the 50%FR (RM1.85) to enhance upside potential towards the 38.2%FR (RM2.02), with stronger upside hurdle coming at the 23.6%FR (RM2.23) ahead. Crucial chart supports at the 76.4%FR (RM1.46) and RM1.33 limit downside risk. Velesto will need to climb above the 76.4%FR (23sen) convincingly, to aim for 26sen and the 28/02/24 peak (28sen) going forward, while key chart supports at the 38.2%FR (15sen) and 23.6%FR (12sen) should cushion downside risk.

Asian Markets Rise as Traders Digest China Data

Asian markets saw gains on Monday, as traders evaluated fresh economic data from China amid ongoing geopolitical uncertainties surrounding Israel-Iran tensions. China's factory output growth hit a six-month low in May, while retail sales picked up steam, offering temporary relief for the world's second-largest economy amid a fragile truce in its trade war with the United States. The spike in sales growth comes as a welcome respite for the world’s second-largest economy that has been struggling with persistent deflation. However, concerns of the tensions triggering a full-blown conflict in the Middle East continue to weigh on the markets.

Meanwhile, traders also remained cautious about the U.S.-China trade deal as uncertainty persists over the latest framework agreement and its implementation details. Japan’s Nikkei 225 jumped 1.26% to 38,311.33, while the Topix added 0.75% to 2,777.13. Over in Australia, the S&P/ASX 200 was virtually unchanged at 8,548.40 and South Korea’s Kospi jumped 1.80% to 2,946.66. In mainland, the Shanghai Composite Index rose 0.35% to 3,388.73, while Hong Kong’s Hang Seng Index gained 0.70% to close at 24,060.99.

Wall Street Rises on Hopes That Israel-Iran Conflict Will Be Contained

Wall Street’s major averages rebounded overnight as traders appeared optimistic that the conflict between Israel and Iran may remain contained. The Dow Jones Industrial Average gained 0.75% to 42,515.09. The S&P 500 climbed 0.94% to end at 6,033.11, while the Nasdaq Composite jumped 1.52% to 19,701.21. Fears of a wider conflict in the Middle East subsided after Iran reportedly asked Qatar, Saudi Arabia, Oman, Turkey and a few European countries to urge US President Donald Trump to put pressure on Israel for a ceasefire, in exchange for Iran's flexibility in nuclear talks.

The attacks continued for a fourth day Monday, with the two countries targeting each other’s energy facilities. Looking ahead, investors will mostly focus on the Federal Reserve’s monetary policy decision due Wednesday, as well as the outcomes of US trade and tariff negotiations held at the G7 summit in Canada.

Corporate

Prime Minister Datuk Seri Anwar Ibrahim said that the country’s utility company Tenaga Nasional Bhd has committed RM43.0bn to upgrade the national power grid. This upgrade will help handle growing energy demand and support renewable energy by using advanced technologies like artificial intelligence (AI) and battery storage systems. The goal is to make Malaysia’s energy system more resilient and flexible for the future. (The Edge)

MBSB Bhd (Not Rated) has approved Islamic financing facilities totalling RM180.0mn for MAG Holdings Bhd (Not Rated) to strengthen its operations across the halal aquaculture value chain. This will particularly help in scaling its cold chain logistics, farming and hatchery infrastructure, and halal seafood export capacity. (New Straits Times)

The Federal Land Development Authority (Felda) today said it has dispatched the offer documents for its plan to privatise FGV Holdings Bhd, with the offer closing at 5pm on 7 July 2025, unless extended. The offer, made via Maybank Investment Bank, will remain open for acceptance until the first closing date or such later date as may be determined and announced by Maybank on its behalf. The offer forms part of Felda’s unconditional voluntary takeover bid to acquire all remaining FGV shares at RM1.30 each. (Bernama)

Malakoff Corporation Bhd's unit Malakoff Radiance Sdn Bhd has teamed up with New Energy Asia Sdn Bhd to jointly deploy electric vehicle (EV) charging infrastructure. New Energy Asia, a joint venture between Hicom Engineering and Hangzhou Flash Charge, is currently exploring a partnership with Malakoff Radiance to support Malaysia's transition to clean mobility. (New Straits Times)

Berjaya Land Bhd (Not Rated) has signed a memorandum of understanding with Swedenbased SIBS Sdn Bhd to deliver climate-resilient modular housing in Greenland. With a gross development value of RM170.0mn, the project will comprise 66 apartment units housed across 8 blocks with built-ups from 2,152 to 4,305s.f. (200 to 400 m2 ). Construction is targeted to commence in July 2026 and is expected to be completed in 2 years. (Bursa Malaysia/The Edge)

Solarvest Holdings Bhd (Not Rated) has, via a joint venture (JV) company, secured a 25- year power purchase agreement (PPA) with the government of Brunei to invest in, build, and operate a 30MWac solar photovoltaic power plant, which will be the largest such plant in Brunei upon its completion by end 2026. The project will be developed on a remediated landfill in Brunei. It is expected to generate an annual output of 64.5mn kWh of renewable energy. (Bursa Malaysia/The Edge)

Deleum Bhd (Not Rated), through its indirect unit Deleum Oilfield Solutions (Thailand) Co Ltd, is buying Thailand-based MPC Future Co Ltd's oilfield service assets and business for RM60.0mn through a combination of cash and share issuance in a subsidiary, to expand its portfolio and services offering in Thailand. The acquisition will include slickline, hydraulic workover and well head maintenance assets from MPC Future. The transaction is expected to be completed in the 2HCY25. (Bursa Malaysia/The Edge)

Former head honcho of Securities Commission Malaysia, Datuk Syed Zaid Albar will take over as group chairman of CIMB Group Holdings Bhd from Tan Sri Mohd Nasir Ahmad, effective 20 July 2025, with the latter retiring on 19 July 2025. In line with the transition, Syed Zaid will be appointed as an independent non-executive director effective 18 June 2025. (Bursa Malaysia/The Star)

Compugates Holdings Bhd (Not Rated) executive director See Thoo Chan has acquired 7.1mn shares in Compugates for RM106,299. The shares were purchased on 13 June at 1.5sen/share, representing a 0.12% stake in the group. See has been increasing his stake in the group since early this year. He now holds a direct interest of 7.9% or 476.6mn shares, up from 6.1% in February. (New Straits Times)

Sersol Bhd’s (Not Rated) executive director Datuk Mohamed Suffian Awang has reemerged as the company’s largest shareholder, after acquiring a 13.7% stake. Mohamed Suffian acquired 100.0mn Sersol shares for a total consideration of RM500,000 via IceAge Property Sdn Bhd in an off-market transaction on 12 June 2025. The transaction price represents an 80.0% discount to Sersol’s closing share price of 2.5sen on the same day. (Bursa Malaysia/The Edge)

Poh Kong Holdings Bhd’s (Not Rated) 3QFY25 net profit came in almost unchanged at RM47.6mn compared to RM47.7mn a year ago mainly due to higher income tax and operating expenses. However, quarterly revenue hit a record high of RM533.9mn (+2.8% YoY) as gold prices surged. For 9MFY25, net profit rose 3.8% YoY to RM98.5mn while revenue increased 2.0% YoY to RM1.3bn. In a separate filing, the group announced the appointment of Choon Wan Joo as its new executive director, effective 20 June. Her appointment follows the resignation of her brother, Choon Yee Bin as executive director. (Bursa Malaysia/The Star)

Economy

Malaysia's Trade Openness Index Rises to 149 in 2024

Malaysia's Trade Openness Index (TOI) increased to 149.0 in 2024, compared to 144.6 in 2023, according to the Department of Statistics Malaysia (DoSM). In a statement, chief statistician Datuk Seri Dr Mohd Uzir Mahidin said the TOI measures the dependence of international trade in goods towards the economy and serves as an indicator of the importance of trade at both national and state levels. He said that based on the latest available data for 2023, four states recorded a higher TOI than the national level. "Penang registered the highest TOI at 542.6, followed by Johor (326.8), Labuan Federal Territory (229.3) and Kedah (220.1),” he said. He added that DoSM is currently compiling the 2024 TOI by state and will be published soon. (The Star, DOSM)

First phase of halal roadmap contributed RM149bn to GDP, with exports hitting RM61.8bn

The first phase of the Halal Industry Master Plan (HIMP2030), covering the period from 2023 to 2025, has recorded encouraging achievements with an implementation rate of 89.7%, said Deputy Prime Minister Datuk Seri Dr Ahmad Zahid Hamidi. Zahid, who is also the Halal Industry Development Council (MPIH) chairman, said that during this period, the halal industry contributed RM149bn to the gross domestic product (GDP), while halal exports reached RM61.8bn. "This achievement is a clear indication that our halal industry development direction is on the right track and is gaining increasing confidence not only domestically, but also in international markets,” he said. Zahid said Malaysia continues to strengthen the halal ecosystem through the expansion of halal parks, which now total 14 strategic parks spanning 200,000 acres nationwide. As of the first quarter of 2025, these parks recorded a cumulative investment of RM3.8bn. (The Edge, Bernama)

Malaysian Retailers Urge MOF to Waive or Defer SST on Commercial Rentals

The Malaysia Retailers Association (MRA) is urging the Ministry of Finance to waive the planned 8% sales and service tax (SST) on commercial rental and leasing services, warning it will further strain retail businesses and ultimately impact consumers through increased inflation. In a statement, the association said the 8% SST on commercial rentals that will kick in on July 1 — introduced without any consultation or engagement with the retail sector — will add further pressure on the retail industry. “Rental is among the largest fixed costs for many businesses and this tax will push operating expenses even higher,” said MRA. It said retail businesses nationwide are already facing immense pressure from a series of escalating costs, including the minimum wage increase to RM1,700, electricity tariff hikes, stamp duty on employment contracts, fuel subsidy rationalisation and the 10% sales tax on low-value imported goods. (The Edge, Bernama)

Malaysia Reaffirms Firm Commitment to Regional Energy Cooperation

Malaysia reaffirmed its firm commitment to driving regional energy cooperation with a focus on inclusivity and sustainability, as it chaired the 43rd Asean Senior Officials Meeting on Energy (SOME). Ministry of Energy Transition and Water Transformation (Petra) secretary general Datuk Mad Zaidi Mohd Karli said the theme for Malaysia’s energy sector engagements, “Powering Asean: Bridging Boundaries, Building Prosperity”, reflects the broader vision of Malaysia’s Asean chairmanship. "This theme is important to emphasise the need for energy and dynamism in driving the region’s development to propel Asean forward. It also reflects the ultimate goal of Asean integration, which is to improve the lives of its citizens by promoting economic growth, creating jobs, and focusing on inclusivity and sustainability that will benefit all segments of society," he said. He also expressed confidence that Monday’s discussions would deliver tangible progress aligned with Malaysia’s Priority Economic Deliverables and Asean’s 2025 priorities, particularly on key initiatives such as the Asean Power Grid Memorandum of Understanding, and the Terms of Reference for the Subsea Power Cable Development Framework. (The Edge, Bernama)

China's Factory Output Slows, Retail Sales Unexpectedly Robust

China's factory output growth hit a six-month low in May, while retail sales picked up steam, offering temporary relief for the world's second-largest economy amid a fragile truce in its trade war with the United States. The mixed data comes as China's economy strains under U.S. President Donald Trump's tariff onslaught following his return to the White House in January. Industrial output grew 5.8% from a year earlier, National Bureau of Statistics data showed, slowing from 6.1% in April and missing expectations for a 5.9% rise in a Reuters poll of analysts. It was the slowest growth since November last year.

However, retail sales, a gauge of consumption, rose 6.4%, much quicker than a 5.1% increase in April and forecasts for an expansion of 5.0%. Data released earlier this month showed exports to the U.S. plunged 34.5% in May from the previous year, the sharpest drop since February 2020, while deflationary pressures deepened last month. Retail sales had shown resilience on the back of strong Labour Day holiday spending and a consumer goods tradein programme heavily subsidised by the government. Fixed asset investment expanded 3.7% in the first five months of this year from the same period a year earlier, compared with expectations for a 3.9% rise. It grew 4.0% in the January to April period. (The Star)

India Wholesale Price Inflation Eases to 14-month Low

India's wholesale price inflation eased further in May to the lowest level in more than a year amid cheaper costs for primary articles, fuel, and power, provisional data from the Ministry of Commerce and Industry revealed on Monday. The wholesale price index, or WPI, rose 0.39% year-over-year in May, slower than the 0.85% increase in April. Economists had expected inflation to ease slightly to 0.80%. Moreover, this was the lowest inflation rate since March 2024. Food inflation moderated to 1.72% from 2.55% in April. Prices for primary articles declined 2.02% annually in May, and costs for fuel and power also showed a further decline of 2.27%. Price increases softened in manufactured products too, from 2.62% to 2.04%. On a monthly basis, wholesale prices edged down 0.06% from April, when they decreased by 0.39%. (RTT)

Singapore Home Sales Drop to Five-month Low on Tariff Fears

Singapore’s new private home sales fell to a five-month low in May, as global tariff tensions weighed on demand in the trade-dependent city-state. Developer sales dropped for a third consecutive month, with just 312 units bought last month, according to data released by the Urban Redevelopment Authority on Monday. The outlook for the Southeast Asian financial hub has dimmed, following Donald Trump’s push for tariffs and the city-state’s economy contracting in the first quarter. Developers have grown more cautious, launching no major projects for sale in May — a pause that further weighed on sales figures. A first-quarter survey of senior real estate executives found that nearly 90% viewed a global economic slowdown as a risk. Their next biggest concerns were job losses and a weakening domestic economy. (Bloomberg)

New York factory activity contracts while outlook improves

New York state factory activity shrank in June by more than projected as orders and shipments contracted, though expectations improved. The Federal Reserve Bank of New York’s general business conditions index declined nearly seven points to minus 16, marking a fourth straight month of contraction, data showed Monday. Readings below zero indicate contraction. The median forecast in a Bloomberg survey of economists called for a reading of minus six. The outlook for business conditions in the next six months jumped more than 23 points, the most in nearly five years when the economic activity began to recover after the pandemic shutdowns. Expectations for orders and shipments rebounded sharply from a month earlier. The survey responses were collected between June 2-9, shortly before the US and China reached a temporary agreement to de-escalate a trade war. The two nations agreed to a framework after two days of trade talks in London that implements the consensus reached in Geneva to lower duties. Meanwhile, an index of current prices paid for materials decreased by more than 12 points, the most in almost two years, to 46.8. Manufacturers’ expectations for prices also declined. At the same time, a gauge of current prices received rose to the second-highest level since early 2023. The outlook for prices charged also increased. (Bloomberg)

Eurozone Labour Cost Growth Eases in Q1

The euro area hourly labour cost increased at a slower pace in the first quarter of 2025, data published by Eurostat showed on Monday. Hourly labour cost grew 3.4% on a yearly basis, following a 3.8% increase seen in the fourth quarter. Wages and salaries and non-wage costs, the two main components of labour costs, grew 3.4% each in the March quarter. In services, hourly labour costs gained 4.3 %, and those in construction climbed 4.7%. Labor costs in industry grew 2.5%. Data showed that hourly labour cost in the EU increased 4.1% after a 4.3% gain a quarter ago. The highest increases in hourly wage costs for the whole economy were recorded in Romania, Croatia, and Bulgaria. (RTT)

Opec Sees Solid Second-half of 2025 for World Economy, Trims 2026 Supply

Opec said on Monday it expected the global economy to remain resilient in the second half of this year despite concerns about trade conflicts and trimmed its forecast for growth in oil supply from producers outside the wider Opec+ group in 2026. In a monthly report, the Organization of the Petroleum Exporting Countries left its forecasts for global oil demand growth unchanged in 2025 and 2026, after reductions in April, saying the economic outlook was robust despite trade concerns. "The global economy has outperformed expectations so far in the first half of 2025," Opec said in the report. "This strong base from the first half of 2025 is anticipated to provide support and sufficient momentum into a sound second half of 2025. However, the growth trend is expected to moderate slightly on a quarterly basis." Opec also said supply from countries outside the Declaration of Cooperation — the formal name for Opec+ — will rise by about 730,000 barrels per day (bpd) in 2026, down 70,000 bpd from last month's forecast. Lower supply growth from outside Opec+, which groups the Organization of the Petroleum Exporting Countries plus Russia and other allies, would make it easier for the wider group to balance the market. Rapid growth from US shale and from other countries has weighed on prices in recent years. (Reuters)

Source: TA Research - 17 Jun 2025