Opening Daily Highlight
Mixed
Muted Equity Sentiment on US Data
Mon, 13-Jan-2025 06:59 am
by Research Team • Apex Research

Market Review & Outlook

Malaysia Market Review: The FBM KLCI index increased 0.10% to cap off a volatile week as the key index ended 1.7% wow lower. On the local bourse, YTL and YTLP led the gainers with both rising 1.2% respectively. Meanwhile, PETDAG and AXIATA were the top laggards, falling by 3.1% and 1.8%, respectively. Sector performance was broadly neutral, with 7 major sectors finishing in the green and 6 in red on subtle signs of stability.

 

Global Markets Review: US stock markets fell as Treasury yields rose on stronger-than-expected jobs data, with Wall Street’s main indexes closing lower and 10 of 11 sectors in the S&P 500, including four primary sectors, ended in the red. In Europe, the STOXX Europe 600 declined by 0.8%, with all major bourses and nearly all sectors down, driven by reactions to the US nonfarm payroll data, pushing Eurozone bond yields to multi-month highs. In the APAC region, markets had a mixed session. The Hang Seng Index in Hong Kong fell 2.8% over five consecutive days, driven by rising US-China tensions, weak economic data, and a hawkish Federal Reserve. Meanwhile, South Korea's KOSPI jumped 2.9% for the week, buoyed by SK Hynix's chip gains and Hyundai Motor's AI partnership with Nvidia.

 

Market Outlook: Sentiment is expected to remain subdued following the release of the better-than expected US nonfarm payroll data, while tempered the prospects of rate cuts. We anticipate the FBM KLCI may mirror the performance the key index looks to defend the psychological 1,600 level. Foreign funds are likely to remain net sellers in the local market, as global capital may shift toward US assets or Treasury securities. On the other hand, the market pullback presents an opportunity for investors to capitalise on lower prices, supported by attractive valuations. Economic wise, investors will be keeping a close tab onto Malaysia retail sales data today.

 

Sector focus.  We maintain a positive outlook on export-oriented sectors such as gloves, furniture, and logistics, as the weaker MYR against the USD enhances their competitiveness in global markets. The technology sector, including semiconductor manufacturing and electronic exports, would benefit from the currency depreciation as their products become more affordable for foreign customers. In addition, higher oil prices lifted by US implementation of wide-range sanctions targeting the Russian energy sector may boost the energy sector on Bursa Malaysia.

 

FBMKLCI Technical Outlook

Technical Commentary: The FBM KLCI staged a mild recovery from the two-day slump on mild bargain hunting activities as the key index defended the 1,600 psychological level. Indicators remained mixed as MACD Line hovered above the Signal Line, while the RSI lingered below 50. Immediate resistance is located at 1,645. Support is envisaged around 1,600.

 

Company News (source: various)

TNB Western Energy Berhad, a subsidiary of Tenaga Nasional Bhd (TNB), received a RM291.5m income tax bill from Inland Revenue Board (IRB) for the year of assessment 2018. TNB WE filed for a judicial review on Dec 31, 2024, and the High Court granted an interim stay on further proceedings, including enforcement of the tax notice, pending the outcome of the review.

 

Berjaya Corporation Bhd is seeking a new partner for its bid on the multibillion-dollar Kuala Lumpur-Singapore high-speed rail (HSR) project after Malaysian Resources Corp Bhd withdrew from the consortium last month. The consortium now includes Berjaya Rail Sdn Bhd, Keretapi Tanah Melayu Bhd, IJM Corporation Bhd, and technical partners like Deutsche Bahn AG, Hitachi Rail, and Hyundai Rotem Co.

 

Sime Darby Property has fully acquired Badar Bukit Raja, Selangor, for RM232m. The warehouses have a combined net lettable area of about 700k sq. ft.

 

Uzma Bhd bags RM100m contract extension from Petronas Carigali. This is through its subsidiary Setegap Ventures Petroleum Sdn Bhd for coiled tubing and services at its offshore field in East Malaysia.

 

Metronic Global Bhd's subsidiary, MAT JV Sdn Bhd, secured a RM31m contract from Gamuda M&E Sdn Bhd to supply, install, test, commission, and maintain instrumentation systems for the Sungai Rasau Water Supply Scheme project.

 

The IRB has accepted Kumpulan Perangsang Selangor Bhd's subsidiary, Bold Approach Sdn Bhd's appeal against an RM7.9m capital gains tax and penalty.

 

Key Alliance Group Bhd has proposed a 30-to-one share consolidation to enhance its capital structure and reduce price volatility. As a result, the share price could increase to 15 sen from 0.5 sen, and the share base will reduce to 122.6m from 3.68bn, with a capital of RM193.4m. The group also aims to reduce its capital by up to RM96.0m to offset accumulated losses of RM101.1m as of September 30, 2024 (Q2FY25).

Sentiment: Neutral
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Market Mover
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Currency Buy Rates (RM) Sell Rates (RM)
USD 4.373243 4.414705
EUR 4.565507 4.577376
CNY 0.602867 0.604630
HKD 0.561419 0.566456
SGD 3.236779 3.265133