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Oil marches on as Tech falters
Thu, 23-Jul-2026 07:46 am
by Research Team • Apex Research

Malaysian Market Review. The FBM KLCI fell 9.00 points, or 0.52%, to 1,711.37, as surging oil prices and caution ahead of US megacap earnings weighed on sentiment. Market breadth turned negative with 584 decliners to 456 advancers. Sector-wise, Industrial Products (+0.60%) and Energy (+0.52%) posted the biggest gains, the latter supported by the Brent's surge past USD95, while Healthcare (-0.75%), Consumer (-0.66%) and Finance (-0.46%) led the decliners.

  

Global Markets: The Dow Jones Industrial Average closed flat at 52,218.58, the S&P 500 slipped -0.14% to 7,498.96, and the Nasdaq Composite fell -0.57% to 25,690.90, as consecutive US strikes on Iran sent the Brent surging +4.21% to USD95.50 and renewed inflation concerns ahead of megacap earnings. Alphabet fell after hours despite a strong quarter as its higher capex guidance unsettled investors, while a Goldman Sachs note flagging around USD489 billion of AI-related debt issued this year pressured Microsoft, Amazon and Meta. In Europe, the energy-heavy FTSE 100 jumped +1.24% and the STOXX Europe 600 added +0.58%. In Asia, Japan's Nikkei 225 extended its rebound with a +3.08% gain, the Shanghai Composite was flat, Shenzhen fell -1.42%, Hong Kong's Hang Seng lost -0.95% and South Korea's KOSPI closed -0.34% lower (CNBC).

 

Market Outlook. Alphabet's after-hours slide despite strong results answers the week's key question in the uncomfortable direction: markets are punishing capex expansion rather than rewarding growth, keeping the AI spending debate open into the remaining megacap reports and next week's Fed meeting. Oil is the second pressure point, with Brent at USD95.50 after eleven straight nights of strikes and diplomacy stalling, and a move towards USD100 would harden the case for a hawkish Fed. For the KLCI, Wednesday’s decline came on due to modest foreign selling, with retail investors absorbing the flow. We would stay patient on entries, favouring oil-linked and domestically anchored names while the capex verdict and oil trajectory play out.

 

Sector focus. Energy counters should stay in focus as the standout beneficiary of Brent above USD95, with upstream producers and services names supported by both price and contract-flow prospects. Technology may open under pressure after Alphabet's capex-driven after-hours decline, and conviction in the local chip chain is likely to stay light until the megacap spending verdict settles.

 

Technical Commentary: The FBM KLCI is still in a constructive consolidation phase after rebounding from the 1,660–1,670 zone, and it is now trading above its 20-, 120- and 200-day moving averages, which supports the broader uptrend. Near term, the index faces resistance around 1,720–1,740, where the descending trendline and recent swing highs converge; a decisive breakout there would likely open the way back toward 1,760–1,770. On the downside, 1,700-1,680 remain the key support to watch, followed by 1,625 if the rebound loses momentum.

 

Company News

Eco-Shop Marketing Bhd reported its highest-ever quarterly net profit of RM72.63 million for 4QFY2026, up 44.91% year-on-year, as revenue hit a record RM772.89 million on improved margins and store expansion, and declared an interim dividend of 0.6 sen per share, bringing the full-year payout to 2.15 sen. (The Edge)

 

IGB REIT's second-quarter net property income jumped 51% to RM181.2 million on a full-quarter contribution from Mid Valley Southkey and higher rental income, with a distribution of 3.44 sen per unit declared, while IGB Commercial REIT's net property income grew 18.5% to RM45.1 million on higher occupancy and lower finance costs, with a 1.35 sen per unit distribution. (The Edge)

 

CTOS Digital Bhd posted a 7% rise in second-quarter net profit to RM22.65 million on higher revenue and declared a second interim dividend of 0.70 sen per share. Separately, it is trimming its stake in Juris Technologies by 10% for RM50 million, with RM24.5 million earmarked for a special dividend of about 1.07 sen per share and another RM24.5 million for share buybacks. (The Edge)

 

United Plantations Bhd reported a 22.2% decline in second-quarter net profit to RM194 million on higher operating expenses and lower joint venture contributions, despite marginally higher revenue, with no dividend declared. (The Edge)

 

UOA REIT declared an interim income distribution of 3.94 sen per unit, amounting to RM26.62 million, as second-quarter net property income surged 30.8% to RM23.48 million on improved occupancies and lower maintenance costs. (The Edge)

 

GDB Holdings Bhd has secured a RM439.4 million contract from a unit of Magma Group Bhd to construct the 60-storey Wolo Hotel & Residences mixed-use tower in Mont Kiara, with works starting in August and completion expected by December 2030. (The Edge)

 

Velesto Energy Bhd has secured a US$51 million (RM208.4 million) contract to provide integrated rig, drilling and completion services for Chevron Malaysia's 2026-2028 North Malay Basin development campaign, deploying its Naga 8 rig. (The Edge)

Orkim Bhd is expanding its fleet to 20 vessels with the RM94.9 million acquisition of an oil and chemical tanker, its second this year, funded through its existing sukuk programme with delivery expected by Oct 20. (The Edge)

 

MyNews Holdings Bhd is acquiring 13.5 acres of industrial land in Rawang for RM24.7 million cash to build a new distribution centre, as its existing facility operates at constrained capacity. (The Edge)

 

London-listed Aberdeen Group plc has emerged as a substantial shareholder in MTT Shipping and Logistics Bhd after acquiring a 5.075% stake worth an estimated RM123.06 million, making it the container liner's third-largest shareholder. (The Edge)

Sentiment: Neutral
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