MY Market Watchtower | WEAK SENTIMENT, KLCI OPENS MARGINALLY LOWER

Jungle lee wrote a column · Sep 8, 2023 09:29

Stock Market Bellwether

Good morning! Here is the information you need to know about today's market:

●US Stock Market Close: US stocks mixed, Nasdaq falls for the fourth consecutive session

●Apple has been sold for two consecutive days, with a cumulative decline of over 6%

●Restructuring debt hinders economic transformation. Bloomberg: Malaysia's long-term growth may drop to 2%.

●The central bank in Malaysia maintains the interest rate at 3.00%.

●Malaysia's external reserves have increased slightly to $112.5 billion.

●Focus on stocks: SKYWLD, YINSON, APOLLO, DESTINI, MNHLDG, PUNCAK, FIAMMA.

-KLSE pulse.

MY Market Watchtower | WEAK SENTIMENT, KLCI OPENS MARGINALLY LOWER

Overnight US market trends.

The overnight U.S. stock market closed mixed on Thursday, with the Nasdaq falling for the fourth consecutive trading day. Concerns about the Federal Reserve's interest rate policy path have re-emerged in the market, and investors are speculating whether the institution will raise rates again this year. Initial jobless claims fell last week, but labor costs rose more than expected.

The Dow Jones Industrial Average closed up 57.54 points, or 0.17%, at 34,500.73; the Nasdaq fell 123.64 points, or 0.89%, to 13,748.83; and the S&P 500 fell 14.34 points, or 0.32%, to 4,451.14.

Among them, $Apple (AAPL.US)$fell 2.9%, continuing the downward trend from Wednesday, with a cumulative decline of 6% over the two days, and a market capitalization loss of $190 billion. There are reports that its iPhone has been banned in certain places and is prohibited from being brought into the office. According to reports, the European Union has released a strict list of digital regulations, with Apple and other tech giants among them.

Movement in the Malaysian stock market.

The overall performance of the Malaysia Stock Exchange is weak, mainly due to cautious trading sentiment, with some investors preferring to take profits and wait and see.

At 9:20 a.m., $FTSE Bursa Malaysia KLCI Index (.KLSE.MY)$fell 0.65 points to 1459.42 points.

185 stocks rose, 209 stocks fell, and 1008 stocks remained unchanged.

Focus News

Bloomberg: Malaysia's long-term growth fears may decline to 2%

After thirty years, no one knows what the future of Malaysia will be like. However, economists from the Bloomberg think tank pointed out that Malaysia's long-term economic growth may fall to 2% by 2053.

Bloomberg economist Tamara pointed out that Malaysia's growth momentum is slowing down, mainly entering the post-epidemic period. The economic performance has rebounded, and the prices of commodities have gradually fallen.

However, in the long term, continuing to maintain a fiscal restructuring plan with perpetual debt will hinder the government's ability to lead Malaysia's transition to a high-income economy.

Not only that, economists say that under the influence of rising loan costs and political risks, the capital expenditures in the private sector will also be subject to more restrictions.

Bank Negara Malaysia maintains the interest rate at 3.00%.

Bank Negara Malaysia announced that it will continue to maintain the overnight policy rate (OPR) at 3.00%! This is in line with market expectations.

Bank Negara Malaysia's Monetary Policy Committee today decided to continue to maintain the latest OPR at 3.00% to support economic growth.

At the current level of interest rates, the current monetary policy stance remains unchanged, continuing to support the economy and is consistent with the assessment of inflation and growth prospects.

The Monetary Policy Committee will continue to remain vigilant and monitor data at all times to assess domestic inflation and growth prospects. The Committee will ensure that the monetary policy stance continues to support sustainable economic growth in stable prices.

Bank Negara Malaysia's rhetoric is consistent with the previous one, that the global economy is still expanding under the support of demand and a strong labor market. However, continuous inflation trends, continuously rising interest rates, and China's performance below expectations have led to continued downside risks to global growth prospects.

Malaysia's external reserves have increased slightly to $112.5 billion.

Malaysia's central bank announced that as of August 30, the country's foreign exchange reserves reached $112.5 billion (about 525.2 billion ringgit), an increase of $0.3 billion from mid-August.

According to a statement released by Malaysia's central bank on Thursday, the existing foreign exchange reserves are sufficient to cover 5.2 months of imports of goods and services, as well as 1.0 times short-term external debt.

In mid-August, Malaysia's foreign exchange reserves reported $112.2 billion (equivalent to about 521.281 billion ringgit at that time exchange rate).

Individual stock focus

$SKYWLD (5315.MY)$Investing 350 billion Vietnamese dong (about 67.9 million ringgit), Seridcorp Group fully acquired a Vietnamese company, thereby gaining the development rights to 1.3 acres of land in Ho Chi Minh City.

According to the announcement, Seridcorp Group completed a deal with several Vietnamese sellers through its subsidiary, acquiring Thuan Thanh Trading Production and Real Estate Trading Joint Stock Company (TT) at a price of 350 billion Vietnamese dong.

TT Company is the sole legal user of the aforementioned land, and Seridcorp Group plans to develop a residential project on the land, including a 24-story apartment building.

The acquisition is expected to be completed by the end of this year. Seridcorp Group intends to use internal funds, bank loans, or issue Islamic bonds to raise the acquisition funds.

$YINSON (7293.MY)$Supported by strong market demand, it is predicted that the Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) can reach close to $1 billion (approximately 4.67 billion ringgit) by 2025.

During an interview with Bloomberg, Lin Zhenyan, the CEO of CloudRise Holdings, pointed out that based on the company's existing orders, it is expected to achieve close to $1 billion EBITDA profit in 2025 and 2026.

"Our renewable energy business will start generating profits next year.

He added that CloudRise Holdings plans to increase the share of green investments to 30% by 2030, currently at 8%.

$APOLLO (6432.MY)$In the first quarter of the 2024 fiscal year, net profit increased by 67.51% year-on-year to 7.64 million ringgit, and announced a dividend of 20 cents per share.

As of July, first-quarter revenue recorded 58.33 million 7000 ringgit, a year-on-year increase of 5.19%.

According to the announcement, the increase in revenue was mainly driven by higher local sales, which in turn led to an increase in net profit.

Looking ahead, the company is optimistic that by taking cautious measures, improving operational efficiency, and focusing on product and service quality, it will continue to achieve satisfactory performance.

$DESTINI (7212.MY)$Announced that the Ministry of Defense awarded a procurement contract worth 19.04 million ringgit.

This contract was awarded to subsidiary Destini Prima Sdn Bhd, which will be responsible for the procurement, supply, and delivery of FZ rocket engine for the Royal Malaysian Air Force.

The contract is valid for 2 years, from September 6th of this year until September 5th, 2025.

$MNHLDG (0245.MY)$Announced that received a power station project contract awarded by Tenaga Nasional Berhad (TENAGA, 5347, utility stock listed on the main board), worth 23.8 million ringgit.

MN Holdings is responsible for constructing and testing a 132 kilovolt (kV) substation in Bekok, Johor for its client.

The contract is effective from September 4th and the project must be completed within 540 days.

MN Holdings Executive Director Datuk Tong Cheong Chan said that the above-mentioned contracts are expected to contribute positively to the company's profitability in the fiscal years 2024 and 2025 (ending in June).

$PUNCAK (6807.MY)$Announced plans to issue perpetual sukuk bonds with a face value of not more than 1 billion ringgit.

This plan will be implemented through its wholly-owned subsidiary, Ideal Water Resources Private Limited.

The company will issue the first batch of Islamic bonds within 90 days after filing with the China Securities Regulatory Commission.

The company stated that issuing these bonds will provide flexibility in funding and meet the financial needs of the company and its subsidiaries.

$FIAMMA (6939.MY)$The subsidiary has obtained approval from the Federal Territory Land Office to acquire 1.88 acres of government land on Jalan Yap Kwan Seng, Kuala Lumpur, for RM 109.64 million.

Jia Man Holdings plans to develop the acquired land into a mixed development project with 20% residential and 80% commercial areas.

The company has made full payment for the land acquisition to the Land Office today.

#stock

#fundamental

#macro matters

#volatility

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-source: Nanyang Siang Pau, Bursa Malaysia

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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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