MY CLOSING BELL REVIEWS | FOLLOWING MARKET FIRMER, KLCI ENDS DROP 0.33 POINTS

Jungle lee wrote a column · Sep 19, 2023 18:29

While waiting for the Federal Reserve to announce its interest rate policy, Asian stocks generally fell on Tuesday, and Malaysian stocks were no exception, following the weak sentiment of global stock markets.

When the market closes at 5 p.m. $FTSE Bursa Malaysia KLCI Index (.KLSE.MY)$It closed at 1457.66 points, down 0.33 points, or 0.02%.

The full-day trading volume was 3.9 billion shares, with a transaction value of RM2.1 billion.

There were 520 rising stocks, 406 falling stocks, 452 had no ups or downs, and 996 had no transactions.

Meanwhile, USD 5.1 was cashed out in ringgit at the level of 4.6965 in the afternoon.

Source: Nanyang Siang Pau, Klse Pulse

MY CLOSING BELL REVIEWS | FOLLOWING MARKET FIRMER, KLCI ENDS DROP 0.33 POINTS

Focus attention

Imports and exports continued to fall by double digits in August. Scholars: The final season may welcome the dawn next year

The Ministry of Investment, Trade and Industry released trade data for August today. Total imports, exports, and trade fell by double digits. Economists said that it is expected that foreign trade will not see the light of day again until the end of this year or the beginning of next year.

According to the latest released data, China's exports shrank by 18.6% year-on-year to RM115.16 billion in August; imports fell 21.2% to RM97.85 billion.

This reduced China's total trade volume in August by 19.8% year-on-year, to only RM213.01 billion.

The statement pointed out that Malaysia's overall trade performance is similar to that of its major trading partners, particularly South Korea, China, Taiwan and Indonesia. Trade volume shrank in August this year, and global imports also declined.

On a monthly basis, exports in August fell 1.4% compared to July; total trade fell 1.5%; imports fell 1.6%.

Furthermore, China recorded a trade surplus of RM17.31 billion in August. This is the 40th month in a row that China has reaped a trade surplus.

Li Xingyu, executive director of the China General Socio-Economic Research Center, said in an interview that Malaysia's trade data for August was indeed worse than previously anticipated.

“Apart from my predictions, according to market forecasts, this data is also showing a downward trend and expanding.”

He pointed out that he believes the September data will still show a double-digit decline; however, driven by the gradual recovery of economic momentum, we will see the dawn at the end of this year or the beginning of next year at the latest.

“Judging from the current situation, September will still be a double-digit decline. Because of this downward trend, it began as early as June.”

“Earlier, I expected Malaysia's exports to shrink by 8.5% per unit for the whole year. If the fall in September continues to expand, it may be necessary to re-evaluate the next trend.”

The economy continued to slow in the third quarter

Li Xingyu also mentioned that as exports and domestic demand remain weak, domestic economic growth will continue to slow in the third quarter.

“As for when the dawn will arrive, we can actually detect one or two from global semiconductor indicators. Because weakness is gradually shrinking, this probably means that the downturn has gradually bottomed out, hoping for an opportunity to rebound.”

He said that electronic and electrical (E&E) products still account for a huge share of Malaysian exports, so they can be viewed as an important indicator.

“Of course, we can also pay attention to the economic performance of China, the US, and the European Union. Once there is an improvement, I believe it will also drive Malaysia's performance.”

“Although the global economy is still slowing down, there is a slight improvement on a monthly basis. Therefore, despite Malaysia's import and export data, there may also be a double-digit decline in the future. However, if the decline starts to shrink, it is still a good thing overall.”

“As long as it doesn't get worse, it's fine; it would be better if the number of units could go back down.”

Furthermore, he pointed out that by the end of the year, spending will usually increase. Coupled with higher demand for automobiles and the introduction of more new mobile phones on the market, it is believed to help drive import and export data.

The budget focuses on the medium to long term

When asked if the upcoming budget will drive import and export data, Lee Hing-yu said that in reality, results will not be seen right away, because the budget mainly focuses on promoting medium- to long-term growth.

“The manufacturing industry is still one of the main engines of Malaysia's economic growth, so I believe the government will continue to push for the expansion of the 2030 New Industrial Blueprint (NIMP2030) plan.”

According to the 2030 New Industrial Blueprint, the government aims to increase the added value of the manufacturing industry by 6.5% each year to RM587.5 billion; the number of employed people will increase by 2.3% each year, reaching 3.3 million people in 2030.

“In order to stimulate imports and exports, I believe the government will introduce more incentives in the budget, but please remember that all of these are aimed at promoting medium- to long-term growth.”

“If we talk about short-term promotion, I believe the government will boost domestic demand and stimulate the economy in the budget.”

Bank of China: Islamic finance needs to unleash innovation

The Bank of China said that the Islamic finance sector needs to transform the economy and sustainable development, unleash more influential innovations, and at the same time double enhance basic values to have a more practical impact.

Bank of Malaysia Governor Dato' Abdullahi said in his speech at the “2023 Global Islamic Finance Forum” today that he would like to take this opportunity to call on the financial community to take action and play a greater leading role in promoting the country's sustainable development.

“There is huge room for innovation in Islamic finance. However, today, the full potential of this finance has not been fully realized, so it cannot be a meaningful tool of change to meet global needs.”

He pointed out that Malaysia has diverse Islamic contracts and tools, which can be customized according to design solutions to meet the needs of different stages of society.

Furthermore, he pointed out that Malaysia has the ability to use “mixed finance” models such as charity and risk, thereby expanding them to credit regulations and risk transfers.

It's all foam? Analysts are bearish, ARM plummeted on the third day of listing

Wall Street investment bank Bernstein is bearish on ARM, the world's largest initial public offering (IPO) this year. The stock price plummeted on the third trading day of listing. It once fell 9.4% during the intraday session on Monday. The stock then recovered part of its decline and closed at $58, down 4.5%.

In any case, the stock's current share price is still above the $51 IPO price.

Earlier, Bernstein began tracking the newly listed chip design company, giving it a “below market” rating, and said the company might not benefit from artificial intelligence as some investors expected.

“While the expectation that ARM will be a beneficiary of AI development may come at a premium, we think it's still too early to announce it as an AI winner,” the analyst wrote.

“As the mobile market matures, we think expectations for revenue growth are too optimistic.”

Bernstein's target price for ARM is just $46.

Bernstein was the third agency to rate Arm. The ratings have been evenly distributed so far. In addition to Bernstein's selling rating, New Street Research suggests buying, while Needham's rating is holding.

The Needham analyst wrote that the valuation “looks reasonable.”

$Arm Holdings (ARM.US)$Monday's decline was in stark contrast to the overall sector trend. The Philadelphia Semiconductor Index rose 0.5%.

Focus on individual stocks

$CDB (6947.MY)$with $YINSON (7293.MY)$A memorandum of understanding was signed to cooperate in the development of domestic electric vehicle services and facilities to promote the use of green energy.

According to the agreement, Yunsheng Holdings will further enhance connectivity when charging electric vehicle-related products through the use of Tiandi Tong's extensive and fast 4G and 5G networks throughout the country.

Additionally, the two sides will work together to explore other innovative solutions to provide consumers with a more accessible net energy ecosystem, including related technologies such as e-Bikes (eBikes), electric vehicles, charging stations, and solar infrastructure.

Dato' Ihamnawai, CEO of Tiandi Digital Network, said at the signing ceremony of the memorandum of understanding, “Our cooperation with Yunsheng Holdings will be long-term, and we will jointly promote innovation and the best electric vehicle technology to the whole country.”

$SCIPACK (8125.MY)$Net profit for the final quarter was RM149,000, a sharp drop of 98.69% year-on-year.

Final quarter revenue was reported at RM185.319,000, down 3.40% from year to year.

Looking at the full year, the company reported net profit of RM35.939,000, a year-on-year decrease of 16.71%, while annual revenue increased slightly to RM774,784,000, an increase of 0.09% year-on-year.

The company said that the decline in exports led to a sharp decline in overall turnover, and the impairment of goodwill in the Myanmar business of RM22.71 million also hurt overall operating performance; however, if this impairment is deducted, operating profit actually increased.

Looking ahead, the company expects the current market to remain weak in the near future due to ongoing geopolitical uncertainty. Coupled with the rise in overall operating costs due to rising inflationary pressure, they all posed challenges to the company.

$PETDAG (5681.MY)$versus $GAMUDA (5398.MY)$Its subsidiary Goldland signed a memorandum of understanding to jointly enhance the convenience and experience of the town's community.

According to the joint statement, Petronas Trading will provide gas stations, products and services, and charging devices for Gentari electric vehicles for Gamuda Cove and Gamuda Gardens, all of which can be seamlessly traded through the Setel app.

Additionally, Petronas Trading will provide a mobile fueling service ROVR to reflect its commitment to the changing preferences of today's customers.

Also, integrated facilities will be built in two towns, including Mesra convenience stores, Mesra cafes, and AutoExpert car service centers.

Petronas Trading Chief Operating Officer Caryl is pleased with this partnership. By combining his expertise in fuel and non-fuel solutions, he can demonstrate his commitment to providing customers with greater convenience.

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Source: Nanyang Siang Pau, Klse Pulse

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Jungle lee

Currently working at Nanyang Siang Pau. Outside of work, enjoys stay active and exploring new investment opportunities.

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