The FBM KLCI rebounded after a 5-day selldown and amid broad-based buying interest emerged in tandem with the positive sentiment across regional markets. However, given the pullback last week on Wall Street, the local bourse may trade in a range bound mode this week ahead of a series of interest rate decisions from the US Fed, UK Bank of England, and European Central Bank. Nevertheless, investors will be looking forward to China’s further reopening and easing of Covid-19 restriction.

Ramssol Group Bhd (RAMSSOL) is regarded as a human capital management (HCM) solution and technology specialist provider with regional presence across 5 countries. Some their key customers include notable entities such as Capitaland Ltd, RHB Bank Bhd, National University of Singapore, Paramount Corporation Bhd, ThaiFoods Group PLC and Export Import Bank of Thailand.

The FBM KLCI was dragged down marginally by the selldown in Petronas-linked heavyweights; 5-day net foreign selling stood at year-to-date high of RM938.8m. The global stock markets are deploying a wait-and-see approach as investors are waiting for more details from the upcoming FOMC meeting, focusing on the US Fed’s interest rate decision next week. Nevertheless, we believe some bargainhunting activities to emerge on the domestic front following the Covid-19 easing measures in China.

The FBM KLCI extended its losing streak as investors continued to stay on the sidelines. While investors may cheer for China’s easing of Covid-19 restrictions, gains might be capped as worries over the US Federal Reserve long rate-hike cycle could dampen the economic growth going forward. On the local front, we believe focus will be on the re tabling of Budget 2023 and traders will be watching the developments on the tackling of high living costs by the government.

EP Manufacturing Bhd (EPMB) started off since 1982 and commenced the manufacturing of moulds in 1991. Today, EPMB manufactures a wide range of products such as engineering plastic components, metal stamping parts and/or modular assemblies for both domestic and international automotive OEMs, including Proton, Perodua, Toyota, TRW, Honda and Suzuki.

The FBM KLCI closed flat as the investors stayed cautious taking cue from the negative Wall Street performance. Moreover, we expect traders to remain on the sidelines ahead of the US CPI data next week, coupled with the FOMC meeting. Defensive stocks with solid track record in their earnings should be favourable under this challenging environment.

We welcome the move as we believe that the extension of new concession period will likely be more favourable with a better lease term and tariff structure against current concession agreement. A structural step up in port tariffs would be on the cards, as we reckon a revision of port tariffs that was unchanged for the past 35 years is long overdue to keep up with the rising operational cost over the years. This will also generate additional CAPEX to improve port facilities to cement their position as the Emerging Port/Terminal of the Year 2021 and Port/Terminal of the Year - South East Asia 2021.

The FBM KLCI declined further as investors deployed a “sell on news” strategy following the formation of new cabinet. With the sentiment turning negative on Wall Street, we expect more profit taking activities to emerge on the local front; especially the technology sector. Nevertheless, we believe the downside risk could be limited with investors eyeing for the 10 new Covid-19 easing measures to be announced by China on Wednesday. Back home, the market will be awaiting announcement from the Ministry of Agriculture and Food Security regarding the new mechanism to control egg prices.