Opening Daily Highlight
Mixed
Index may benefit from strengthening MYR
Tue, 06-May-2025 07:41 am
by Research Team • Apex Research

Market Review & Outlook

Malaysia Market Review: The FBM KLCI closed lower by 0.2%, retreating from intraday gains earlier in the session, as investors adopted a wait-and-see approach amid ongoing uncertainties surrounding the reciprocal tariffs, which are currently under discussion in Parliament. Similarly, lower liners also ended in the red, with only two sectors— Financial and Property closed in positive territory. Notably, Technology (-2.02%) and Energy (-1.76%) were the top decliners, dragged by the stronger MYR and a decline in global oil prices.

 

Global Markets Review: Wall Street ended its nine-day winning streak, closing in the red overnight as investors weighed the implications of the newly announced 100% tariffs on non-US film productions and remained cautious ahead of the upcoming FOMC statement. European markets were mixed, while most Asia Pacific markets closed higher, buoyed by China’s signal of a potential resumption of trade talks with the US, which could help ease trade tensions.

 

Market Outlook: We expect the market today to remain sensitive to developments around the strengthening MYR and the four conditions laid out by Minister Tengku Zafrul in ongoing tariff negotiations with the US. While there is high potential for a tariff rate reduction, which could boost market sentiment, Malaysian businesses may face structural challenges if required to narrow trade discrepancies with the US. As such, we maintain a cautious stance, given that significant uncertainties still linger. Investors will also be closely monitoring the FOMC statement later this week for clarity on the Fed’s interest rate outlook.

 

Sector focus. Large-cap stocks, particularly within the Financial sector, are expected to attract investor interest, supported by the strengthening MYR, which may encourage foreign fund inflows into the local bourse. On the other hand, export-oriented sectors, especially the Technology sector, could face near-term pressure due to both the stronger MYR which affects earnings translation and potential US pressure to reduce trade imbalances, which may impact future sales or margins.

 

FBMKLCI Technical Outlook

Technical Commentary: The FBM KLCI formed a shooting star candle and staged a mild pullback yesterday. Indicators, however, remained positive with the MACD Line hovered above the Signal Line, while the RSI steadied above 50. A mild pullback beckons following the recent strong run-up. Technically, the immediate resistance is located at 1,550. Support is envisaged around 1,500.

 

Company News 

Higher festive sales, improved gross margins, and continued store expansion lifted Mr DIY Group (M) Bhd's revenue and net profit to record highs in the first quarter ended March 31, 2025 (1QFY2025). 

 

Lotte Chemical Titan Holding Bhd reduced its net loss to RM125.67 million in the 1QFY2025, down from RM178.03 million a year earlier, due to better margins, lower depreciation, and profits from its 40%-owned associate,

 

Frontken Corp Bhd, which posted a 3.37% increase in net profit for the 1QFY2025, said it is exploring potential collaborations with strategic partners to expand its footprint, as more countries seek to onshore their semiconductor capabilities.

 

Gamuda Bhd has sold a 389-acre plot of land in Port Dickson, originally purchased for data centre development, to Google affiliate Pearl Computing Malaysia Sdn Bhd for RM455.23 million.

 

TAS Offshore Bhd has secured shipbuilding contracts worth about RM38 million for six tugboats from two new customers in Indonesia. 

 

West River Bhd, which debuted on the ACE Market on Monday, has secured a RM13.88 million contract from China Railway Engineering Corporation (M) Sdn Bhd, a company primarily involved in trading construction materials and equipment.

 

Ekovest Bhd said the government has approved the construction of two links under Phase 2A of the Duta-Ulu Kelang Expressway, also known as the Duke project. 

 

Tan Chong Motor Holdings Bhd is set to introduce the Chinese automotive marque Wuling to the Malaysian market under the brand name TQ Wuling, marking the group's latest foray into the electric vehicle (EV) segment. 

Sentiment: Positive
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Market Mover
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