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Profit-Taking Emerges Amid Deal Optimism
Thu, 16-Apr-2026 07:42 am
Apex Research

Malaysian Market Review: The FBMKLCI dropped 0.28% to 1,683.42 on Wednesday as profit taking emerged in heavyweight counters following the previous day's rally, driven by selling pressure in financials and utilities. Nonetheless, market breadth remained positive, with 623 advancers against 484 decliners, with Technology (+3.22%), Construction (+1.03%) and Consumer (+0.58%) leading gains, whilst Utilities (-0.96%), Plantation (-0.43%) and Logistics (- 0.26%) retreated.

Global Markets: Wall Street extended its rally on Wednesday, with the S&P 500 gaining 0.80% to a new all-time high of 7,022.95 and the Nasdaq advancing 1.59% to a record 24,016.02, while the Dow Jones dropped 0.15%, as investors remained hopeful a US-Iran peace deal could materialise following Trump's comments that the war was "very close to over". In Europe, the STOXX 600 finished Wednesday's session 0.43% lower as traders assessed the trajectory of the US-Iran war, with European luxury brands dragging markets into negative territory following a raft of disappointing earnings (CNBC). Asian markets broadly rose on Wednesday, with South Korea's Kospi gaining 2.07%, Japan's Nikkei 225 advancing 0.44% as hopes of a diplomatic solution to the US-Iran conflict lifted risk appetite, while the Shanghai Composite also edged up 0.01%.

Market Outlook. Markets are expected to remain cautiously optimistic but headline-driven as the April 22 (Asian time) ceasefire deadline approaches. Pakistan's army chief arrived in Tehran with a message from Washington to discuss a second round of negotiations, but nothing has been scheduled yet (BBC). This signals active mediation efforts though the White House has denied reports of formally requesting a ceasefire extension (BBC). CENTCOM confirmed the blockade had "completely halted" Iran's economic sea trade within 36 hours, with six vessels intercepted and turned back in the Gulf of Oman by over 10,000 troops and more than a dozen warships (NYT). Iran warned it could extend disruptions to the Persian Gulf, Sea of Oman and Red Sea if the blockade continues, while Trump claimed China was "very happy" with US efforts to reopen the Strait, though Beijing called the move "dangerous and irresponsible" (CNN). Trump also said the conflict was "close to over," though he cautioned that US strikes could continue as long as needed to prevent Iran from obtaining a nuclear weapon (Fox Business). Following Tuesday's direct talks in Washington, Israel's security cabinet convened to discuss a possible Lebanon ceasefire, though both sides continued to exchange fire (BBC). Against this backdrop, the Malaysian market is expected to remain headline-driven, balancing energy sector tailwinds against the prospect of a sharp oil price correction should talks produce a breakthrough before the ceasefire expires.

Sector focus. We maintain a selective stance on energy and plantation stocks as crude and vegetable oil prices remain elevated, though both face increasing downside risk as diplomatic momentum builds ahead of the April 22 (Asian time) deadline. Technology and financials may see continued support should a second round of talks materialise. Defensive plays including utilities and telecommunications remain attractive amid still-fluid geopolitical headlines. We turn cautious on shipping and logistics names as Iran's threat to extend disruptions to the Red Sea and Gulf of Oman introduces a new layer of uncertainty beyond the Strait of Hormuz.

FBMKLCI Technical Outlook
Technical Commentary: With the S&P 500 and NASDAQ hitting new highs and Asian indices resuming their uptrend, the FBM KLCI may attempt to reclaim its uptrend line. However, failure to sustain above this level could see selling pressure persist. Immediate downside risk is seen at 1,665, with a break below reinforcing bearish momentum and signalling sustained near-term weakness.

Company News
ITMAX System's 65%-owned subsidiary Southmax secured a RM603.5 million variation order from Johor Bahru City Council to expand AI video surveillance systems deployment over 20 years. (The Edge)

Sunway Bhd appointed Tan Sri Abdul Wahid Omar, former Minister overseeing the Economic Planning Unit and ex-chairman of Bursa Malaysia, as an independent non-executive director. (The Edge)

Tuju Setia Bhd won a RM359.27 million contract from Sime Darby Property to construct three 17- storey business service apartment blocks in Ara Damansara, with works beginning 21 April. (The Edge)

Tropicana Corporation Bhd redeemed an additional RM133.2 million under its RM1.5 billion sukuk programme, bringing total repayments to RM1.25 billion as part of debt reduction initiatives. (The Edge)

LBS Bina Group Bhd subsidiary settled a legal dispute over an alleged RM43.03 million outstanding amount through a RM7 million settlement without admission of liability. (The Edge)

Uzma Bhd secured three coiled tubing contracts from PETRONAS Carigali for well services in Sarawak and Sabah through February 2031. (The Edge)

Express Powerr Solutions (M) Bhd expanded into Indonesia with a 15-megawatt diesel power generation project in Lombok providing generator rental services. (The Edge)

MGB Bhd won a RM34.76 million subcontract to construct 75 residential villas in Jeddah, Saudi Arabia for developer Roshn Group's mixed-use development. (The Edge)

Infomina Bhd reported a 7.5% year-on-year increase in net profit to RM8.76 million for 3Q, with quarterly revenue rising 50.43% to RM75.89 million. (The Edge)

Dialog Group Bhd commenced Phase 3 expansion of Pengerang Deepwater Terminals, scheduled for completion by mid-2028 to add 614,000 cubic metres of refined petroleum storage capacity. (The Edge)
 

Sentiment: Neutral
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USD 3.941293 3.973014
EUR 4.659467 4.664334
CNY 0.580021 0.580641
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