FoundPac Group Bhd (FPG) engages in the design development, manufacture, marketing and sale of precision engineering parts. Some of the group’s key business associates include multinational semiconductor companies such as Broadcom, Synergie - CAD, Bece Pte Ltd, U4Global Solutions and GFMI.

The FBM KLCI retreated on Friday as broad-based profit taking activities emerged ahead of the long weekend. The global stock markets started the week largely in a weaker note as protest over China’s strict Covid-19 restriction stoked worries over the global financial recovery. The local bourse may follow suit as buying momentum may slow down moving, while focusing on the ongoing earnings season. Meanwhile, investors may watch the formation of the cabinet in the near future as well as the re-tabling of Budget 2023.

Albeit a potential recovery could take shape, we reckon that challenges may persist from the rising operational costs environment which may dampen the margins. Going forward, the outstanding construction orderbook of approximately RM435.0m (as at end-3QFY22) will provide earnings visibility over the next 2-3 years.

The FBM KLCI witnessed a strong rally after the unity government is formed with PH being the largest party in the alliance and PH’s Chairman Datuk Seri Anwar Ibrahim is being appointed as Malaysia’s 10th Prime Minister. Following the conclusive outcome of the GE15, foreign investors turned net buyer, snapping a 6-day outflow streak and a stronger MYR, we believe the local bourse will continue its uptrend move amid rising investors’ confidence. Besides, the FOMC meeting minutes that saw some of the Fed’s official turning less hawkish may be perceived as positive to the stock markets.

The FBM KLCI eked out small gains in a volatile session amid mixed sentiment due to the fluid situation on the political scene. Optimism surrounding the slowdown in rate hikes indicated in the FOMC minutes may spread across the regional markets. Given the UMNO Supreme Council has given the support to a unity government ensuring the stability of the country, we believe the market may turn more positive. Meanwhile, investors could shift their focus from politics to Malaysia’s inflation rate and the on-going reporting season.

Coastal Contracts Bhd’s (COASTAL) history traced back to 1976 and has now evolved into a global integrated marine oil & gas services and solutions provider. Since incorporation, COASTAL its related companies have delivered over 400 vessels to both local and international oil & gas players.

Moving forward, we expect the medical segment which makes up to 56.0% of total revenue in 3QFY22 to remain as the key contributor to the overall group revenue. This will be supported by progressive launches of new products that is in line with the growing demand. Also, two new products (Mermaid declotting device and IHS syringe infusion system) launching in 2HFY22 is expected to strengthen the contribution from the medical segment in FY23.

The FBM KLCI slipped for another session with persisted foreign outflow as investors remained focused on the pending selection of Malaysia’s 10th Prime Minister. Meanwhile, Wall Street advanced overnight on the back of solid company earnings the positive momentum, this positive momentum could spill over to the regional markets. However, we believe the upside on the local front could be capped due to the fluid developments in the political scene, and greater clarity on that is required to boost investors’ confidence.