The FBM KLCI closed with modest gains after paring the morning session losses, but gains were capped by the weakness in index-linked glove counters amid softer glove ASP expectation and market talks over windfall tax on glove companies. Meanwhile, Bank Negara Malaysia (BNM) kept the OPR unchanged at 1.75% and this may suggest that Malaysia’s economic outlook may be neutral to upward bias despite the resurgence of Covid-19 cases as well as the implementation MCO3.0. In the US, however, jobless claims fell more than forecast as market condition improved following the economy reopen. Commodities wise, the copper price rose above USD10,000 while the CPO price surged above RM4,200.
Technical Focus – TASCO
The FBM KLCI declined for the fourth consecutive session due to persistent selling pressure from the foreigners and the broader market may further consolidate as concerns over the expansion of MCO 3.0 to several districts in Johor, Perak and Terengganu, which may dampen the buying interest today. Investors will keep an eye on the overnight policy rate (OPR) announcement by Bank Negara Malaysia (BNM). On a side note, the government has launched a RM3.5bn Jaringan Prihatin stimulus package to subsidise data plan subscriptions and mobile device purchases. Commodities wise, oil prices have been rising, boosted by higher fuel demand amid easing of lockdowns in the US and parts of Europe during summer.
While ASPs for the quarter under review is still on the rise, we reckon that the upward trajectory has already hit an inflection point. Still, demand remains relatively robust as it continues to outweigh the current supply. At the same time, the resurgence of Covid-19 cases globally will continue to support the demand over the near term.
An international electrical power technology company that offers solutions for High Voltage (HV) and Extra High Voltage (EHV) electrical system with products and services exported to 20 countries across the globe. Outstanding orderbook of RM2.21bn will provide earnings visibility till FY27, supported by 3 concession projects. Aims to venture into the electric vehicle industry, though it is still on the premature stage, particularly in Malaysia market. Technically, traders may anticipate for a breakout above RM1.10, targeting the next resistances at RM1.22-1.28 with long term target set at RM1.43.