Opening Daily Highlight
Mixed
Profit Taking Emerges
Tue, 05-Aug-2025 07:42 am
by Research Team • Apex Research

Malaysia Market Review: The FBM KLCI (-0.4%) ended lower as investors locked in recent gains following yesterday’s rally. The pullback also reflects a more cautious sentiment amid weak US jobs data. The lower liners were mixed, while the Healthcare sector (-1.4%) emerged as the top decliner among the sectors.

 

Global Markets Review: Wall Street rallied overnight, driven by strong gains in technology stocks. Renewed speculation that the Federal Reserve may start cutting interest rates as early as September added to the bullish sentiment, lifting equities and sending Treasury yields lower. European markets also advanced, with bank stocks leading the gains after the UK Supreme Court overturned a motor finance ruling, easing concerns over industry-wide liabilities. Meanwhile, Asia-Pacific markets mostly closed higher on Monday, supported by optimism over potential US rate cuts.

 

Market Outlook: We expect the FBM KLCI to stage a rebound, taking cues from the positive overnight performance on Wall Street. The lower liners may also see some recovery amid improving market sentiment. While Friday’s weaker-than-expected US jobs data raised concerns over the resilience of the economy, the slowdown in hiring could strengthen the case for potential interest rate cuts by the Federal Reserve. We reckon that stronger buying interest from local institutional funds following the announcement of the 13th Malaysia Plan (13MP) should also help cushion overall market weakness stemming from persistent foreign fund outflows. Market attention will now turn to the upcoming release of a slew of corporate earnings and the US ISM Services PMI later today, which may offer further direction.

 

Sector focus. We maintain a positive outlook on the Utilities and Renewable Energy sector, underpinned by domestic reforms and strong policy support driving growth in the power segment. We also anticipate buying interest may spillover towards the technology sector on the local front, mirroring the recovery in Nasdaq.

 

FBMKLCI Technical Outlook

Technical Commentary: The FBM KLCI formed a hanging man candlestick pattern, closing above the SMA50 level yesterday. Indicators turned negative with the MACD Line ending the day below the Signal Line, while the RSI has fallen below 50. Immediate resistance is located at 1,550, followed by 1,580. Support is envisaged around 1,511.

 

Company News (source: various)

Bumi Armada Bhd and Petronas-linked MISC Bhd have mutually called off their proposed merger, ahead of the lapse of their memorandum of understanding (MOU) on Aug 14.

 

Zetrix AI Bhd said it will provide "front-end solutions" in future IT project collaborations with its 19.19%-owned Heitech Padu Bhd.

 

Kelington Group Bhd is in talks with an unnamed client for a semiconductor hook-up project at a wafer fabrication plant in Dresden, Germany, potentially worth up to €50 million (RM244 million).

 

The independent adviser for Kim Hin Industry Bhd, New Paradigm Securities Bhd, has advised minority shareholders against taking chairman Chua Seng Huat’s offer to take the company private for 85 sen a share, calling it not fair and not reasonable.

 

Hibiscus Petroleum Bhd, under its 2030 Mission strategy, wants to increase its net production rate to 70,000 barrels of oil equivalent per day by 2030 from 27,000 currently, and raise its proven and probable reserves to 150 million barrels of oil equivalent (mmboe) from 84.9 mmboe as at end-January 2025.

 

Johor Plantations Group Bhd has signed an MOU with YPJ Plantations Sdn Bhd and PIJ Holdings Sdn Bhd, two Johor state-linked firms, to improve and modernise the palm oil sector in Johor.  

 

Ajiya Bhd is disposing of two industrial land parcels in Nilai, Negeri Sembilan, for a total of RM51.94 million as part of its strategy to monetise non-core assets and strengthen its financial position. 

 

Pekat Group Bhd’s 60%-owned subsidiary company EPE Switchgear (M) Sdn Bhd has bagged a RM31.32 million contract from Tenaga Nasional Bhd to undertake switchgear equipment maintenance and repair works. 

 

Kimlun Corp Bhd has proposed a private placement to raise up to RM40.64 million to raise funds to meet the company’s working capital needs.

 

Jiankun International Bhd plans to issue shares to settle RM8.24 million in outstanding debt, which will result in subcontractor Crimson Power Sdn Bhd emerging as its new largest shareholder with a 30.13% stake.

 

Farm Price Holdings Bhd’s planned acquisition of a Johor-based grocer has hit a legal snag after an interim injunction order dated July 24 prevented Hong Yun Vegetables & Fruits Sdn Bhd from selling its assets worth up RM849,376.07.

Sentiment: Negative
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