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Caution Prevails as Tech Valuation Fears Linger
Fri, 07-Nov-2025 08:05 am
by Research Team • Apex Research

Malaysia Market Review: The FBM KLCI (-0.2%) ended lower on Thursday, weighed down by late selling and profit-taking in blue chips despite the stronger performances in regional markets. Nonetheless, lower liners ended higher. Sector-wise, Construction (+0.9%), Energy (+0.8%) and Transportation & Logistics (+0.7%) led the gainers, while Healthcare (-0.6%), Finance (-0.5%) and Utilities (-0.4%) were the main laggards.

 

Global Markets Review: Wall Street closed lower on Thursday, with the Dow (-0.8%), S&P 500 (-1.1%) and Nasdaq (-1.9%) declining as the tech selloff resumed amid stretched valuations and mounting economic uncertainty, following data from global outplacement firm Challenger, Gray & Christmas showed over 153,000 job cuts in October, the highest in nearly a year. European markets also ended lower as investors digested another round of mixed corporate earnings. Meanwhile in Asia, markets closed higher with Japan’s Nikkei 225 (+1.3%), China’s Shanghai Composite (+1.0%) and Hong Kong’s Hang Seng Index (+2.1%) advancing on positive US economic data, as private payrolls rose by 42,000 and exceeded expectations.

 

Market Outlook. Global sentiment remains cautious as investors debate whether tech valuations have become overstretched following another selloff on Wall Street. The latest US layoff data raised concerns about a weakening labour market and slowing economic momentum, particularly amid the prolonged government shutdown that has delayed key data releases. While uncertainty abroad could weigh on risk appetite, Bank Negara’s decision to maintain the Overnight Policy Rate at 2.75% should continue to provide a stable domestic backdrop. The FBM KLCI is expected to open lower today but remain range-bound between 1,616 and 1,620 as investors await fresh catalysts from corporate earnings and global developments.

 

Sector focus. We remain positive on selective construction, power ancillary, and renewable energy counters, supported by data centre expansion and the ongoing energy transition. In addition, we favour selective consumer stocks, particularly those within the consumer staples segment, backed by steady domestic consumption and resilient earnings visibility.

 

Company News (source: various)

AEON Credit Service (M) Bhd said it will inject RM125 million into 50%-owned AEON Bank (M) Bhd to strengthen the digital bank’s capital base and support future growth. 

 

Axis Real Estate Investment Trust is acquiring an industrial property in Seberang Perai Tengah for RM800 million from Ann Joo Steel Bhd, to whom it is leasing back the asset post-acquisition. 

 

Gamuda Bhd has signed a pact to explore supply and sales of excess treated water to Penang from its proposed plant in Perak.

 

GDB Holdings Bhd has secured a court order enforcing an RM83 million adjudication award in its dispute with KSK Land Sdn Bhd over payments following the developer’s termination of its unit as the main contractor of the 8 Conlay project. 

 

Heineken Malaysia Bhd has cautioned that the recently announced excise duty hike on alcoholic beverages is expected to impact consumer sentiment and operating costs, as its net profit barely moved in the third quarter ended Sept 30, 2025.

 

Delisted KNM Group Bhd said its shareholders have approved the €270 million (RM1.34 billion) sale of German unit Deutsche KNM GmbH (DKNM), which houses the group's crown jewel Borsig GmbH.

 

Kumpulan Perangsang Selangor Bhd said its 51%-owned unit Aqua-Flo Sdn Bhd secured two contracts worth a total of RM53.05 million for the supply of water treatment chemicals. Both contracts — one for the provision of pH-adjusters and another for polyelectrolytes (water soluble polymers) — will start on Jan 1, 2026. 

 

Pentamaster Corp Bhd has logged a 45.3% y-o-y rise in net profit for the third quarter despite a slip in sales. 

 

Pertama Digital Bhd shares will be suspended on Nov 14 after the government e-service provider failed to meet its regularisation plan submission deadline of Oct 31. The company had appealed for a further extension of time.

 

Sentral REIT saw its third-quarter net property income (NPI) slip, no thanks to higher operating expenses, including one-off equipment repairs and replacement costs across several properties.

Sentiment: Negative
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