MY Morning Wrap | Sime Darby's Bid for UMW Holdings Goes Unconditional

Moomoo News MY wrote a column · Dec 28, 2023 07:53

Good morning mooers! Here are things you need to know about today's market:

●The Dow Jones reached a new peak with the S&P 500 close behind, as rate cut hopes lift markets

●Malaysia's PPI declines as sectors contract in November 2023

●Ringgit strengthens against US dollar

●Sustainable investments set to surge amid climate concerns

●Stocks to watch: Sime Darby, Sime Darby Property, Ekovest

-moomoo News MY

MY Morning Wrap | Sime Darby's Bid for UMW Holdings Goes Unconditional

Wall Street Summary

The $Dow Jones Industrial Average (.DJI.US)$ edged up to a fresh peak on Wednesday, while the $S&P 500 Index (.SPX.US)$ lingered just shy of its record level, as the anticipation of a year-end surge persisted among investors. This optimism is largely driven by the prospect of a decline in U.S. interest rates in 2024. Meanwhile, the S&P 500 saw a modest increase of 0.14%, and the $Nasdaq Composite Index (.IXIC.US)$ advanced by 24 points, equating to a gain of 0.16%.

Breaking News

Malaysia's PPI declines as sectors contract in November 2023

In November 2023, Malaysia's Producer Price Index (PPI) reported a year-on-year decline of 1.5%, marking a sharper fall than October's 0.3%. The Statistics Department noted contractions across all sectors except for a slight 1% growth in water supply. The mining sector led the downturn with a 4.7% drop, while manufacturing saw a 1.4% decline. Concurrently, the agriculture, forestry, and fishing sector and the electricity and gas supply both recorded contractions. Despite this, the finished goods index retained a 1.7% growth, albeit at a reduced pace from the previous month.

Sustainable investments set to surge amid climate concerns

Climate change concerns are driving a notable shift toward sustainable investments, with Affin Hwang Investment Bank Research forecasting increased demand despite a current slowdown in fund inflows. The bank's 2024 report suggests a resilient interest in ESG-focused funds, with the construction sector poised for growth through renewable energy initiatives. Key beneficiaries like Samaiden Group Bhd and Tenaga Nasional Bhd are expected to thrive amid these trends, while the plantation sector faces sustainability challenges.

Ringgit strengthens against US dollar

The Malaysian ringgit saw a rebound, closing higher against the US dollar on Wednesday amid a weaker greenback and a quiet data week. Ending the day at 4.6275/6330, the ringgit's rise from Tuesday's close is attributed to expectations of a more relaxed Federal Reserve policy in 2024. While trading activities are expected to be subdued due to the holiday season, the ringgit showed mixed results against other major currencies but managed marginal gains against the Japanese yen and the Singapore dollar.

Stocks to Watch

$SIME (4197.MY)$: Sime Darby Bhd's effort to acquire the outstanding 38.82% stake in UMW Holdings Bhd has advanced to an unconditional stage, with the offer standing at RM5 per share. This follows after securing over half of the voting shares. Shareholders have until 5pm on January 17 to accept the offer, which is subject to possible extensions or revisions per regulatory guidelines. The move comes after Sime Darby's August agreement with Permodalan Nasional Bhd for a 61.18% stake in the automotive company.

$SIMEPROP (5288.MY)$: Sime Darby Property Bhd's sukuk musharakah programme has retained its AA+ rating and stable outlook from MARC Ratings Bhd for the third year in a row. The company reported RM1.4 billion in outstanding sukuk as of November 2023 and highlighted its strong earnings visibility until 2026, backed by RM3.7 billion in unbilled sales recorded at the end of September 2023.

$EKOVEST (8877.MY)$: Ekovest Bhd has joined forces with Zhejiang Communications Investment Group Co Ltd (CICO), a leading state-owned enterprise from China, to collaboratively seek out and develop various infrastructure initiatives across Malaysia. The partnership will focus on infrastructure concessions, major projects, food security, trading, retail ventures, and transit-oriented developments.

$AWANTEC (5204.MY)$: Awantech has landed a RM4.88 million contract with the Ministry of Education for a three-year Learning Management System (LMS) licence subscription, marking the company's inaugural venture into digital learning platforms. This agreement aligns with efforts to enhance digital proficiency among education service officers.

$JSB (5673.MY)$: Jentayu Sustainables Bhd announced the successful commencement of its Telekosang Hydro 2 plant in Sabah, with a 16MW capacity, signaling the full completion of the 40MW Telekosang Hydro run-of-river project. Following Telekosang Hydro 1's operational start in February, the company is now awaiting certification from the Sustainable Energy Development Authority and Sabah Electricity, expected within three months.

Source: Dow Jones Newswires, Bursa Malaysia, The Malaysian Reserve, The Star, The EDGE

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