PublicInvest Research Headlines - 26 Mar 2021

Date: 26/03/2021

Source  :  PUBLIC BANK
Stock  :  GAMUDA       Price Target  :  3.94      |      Price Call  :  HOLD
        Last Price  :  2.84      |      Upside/Downside  :  +1.10 (38.73%)
Source  :  PUBLIC BANK
Stock  :  ASTRO       Price Target  :  1.38      |      Price Call  :  BUY
        Last Price  :  1.13      |      Upside/Downside  :  +0.25 (22.12%)
Source  :  PUBLIC BANK
Stock  :  POHUAT       Price Target  :  2.15      |      Price Call  :  BUY
        Last Price  :  1.35      |      Upside/Downside  :  +0.80 (59.26%)


US: Economy unexpectedly grows more than previously estimated in 4Q. Economic activity in the US unexpectedly grew faster than previously estimated in 4Q20, according to revised data released by the Commerce Department. The report showed real GDP surged up by 4.3% in the 4Q compared to the previously reported 4.1% jump. Economists had expected the pace of GDP growth to be unrevised. The Commerce Department said the stronger than previously estimated growth primarily reflected an upward revision to private inventory investment that was partly offset by a downward revision to non-residential fixed investment. Despite the upward revision, the GDP growth in 4Q still reflects a substantial slowdown from the 33.4% spike seen in 3Q. (RTT)

US: Weekly jobless claims pull back to lowest level in a year. After reporting an unexpected increase in first-time claims for US unemployment benefits in the previous week, the Labor Department released a report showing initial jobless claims pulled back by much more than expected in the week ended March 20th. The report said initial jobless claims slid to 684,000, a decrease of 97,000 from the previous week's revised level of 781,000. Economists had expected jobless claims to decline to 730,000 from the 770,000 originally reported for the previous week. With the much bigger than expected decrease, jobless claims dropped to their lowest level since hitting 282,000 in the week ended March 14, 2020. Oxford Economics noted new claims for emergency Pandemic Unemployment Assistance benefits also fell, pushing total new claims below 1m for the first time since the emergency program was created a year ago. (RTT)

EU: German consumer sentiment set to improve in April. German consumer sentiment is set to improve in April after the easing of the hard lockdown and falling infection rates at the time of the survey, data from market research group GfK showed. The forward-looking consumer sentiment index rose to -6.2 in April from revised -12.7 in March. The reading was forecast to climb to -11.9. With infection rates rising again and the lockdown will be tightened again, it is questionable whether the improvement in consumer confidence will continue, Gfk observed. (RTT)

UK: BoE chief economist says ‘rip roaring’ recovery possible. The UK economy could see a “rip roaring” recovery even if consumers spend just a bit of the additional savings they accumulated during the Covid crisis, according to BoE Chief Economist Andy Haldane. Doubling down on his optimistic outlook for an economic resurgence, Haldane told that he expects a sharp bounce back as restrictions on the economy are removed. He said about GBP150bn (USD205bn) has been saved over the past year, mostly by higher income households. “If some of those savings do get spent, even a small amount of them, we’re talking about a pretty rip roaring recovery,” he said. “When it comes, it will come fast, and it will be large.” Haldane’s comments follow data showing UK business activity increased at the fastest pace since August this month, bolstered by new orders and a rebound in confidence in anticipation of easing lockdown restrictions. (Bloomberg)

UK: Retailers expect sales to rise in April – CBI. UK retailers expect sales to rise in April as non-essential retail shops are anticipated to reopen from mid-April, the latest Distributive Trades Survey from the Confederation of British Industry showed. A net 45% of retailers said sales volume declined sharply in March. But a net 17% forecast sales to grow in April. A net balance of 33% reported a decline in orders in March versus -36% in February. Nonetheless, a net 1% forecast orders to rise in April. The survey showed that internet sales growth eased in March. The net balance fell to 60% from a record 75% in February. Retailers are looking forward to April with a sense of optimism, given the potential re-opening of the sector across the UK, Ben Jones, principal economist at the CBI, said. (RTT)

Hong Kong: Export growth slows in February. Hong Kong's merchandise exports grew at a softer pace in February, data from the Census and Statistics Department showed. Exports rose 30.4% YoY in February, after a 44.0% increase in January. Imports gained 17.6% annually in February, following a 37.7% increase in the previous month. The trade deficit widened to HKD14.699bn in February from HKD38.551bn in the same month last year. In January, the deficit was HKD25.228bn. (RTT)

Philippines: Central bank holds rates at record low as recovery concerns grow. The Philippine central bank kept key interest rates steady, balancing the need to support an economy facing renewed challenges from fresh coronavirus curbs with concerns about quickening inflation. The Bangko Sentral ng Pilipinas (BSP) kept the rate on the overnight reverse repurchase facility at a record low of 2.0% for the third consecutive meeting, as predicted by all 13 economists in a Reuters poll. The rates on the overnight deposit and lending facilities were also held steady at 1.5% and 2.5%, respectively. With Covid-19 cases rising, the government reimposed stricter rules on movement in the capital Manila and nearby provinces this month, threatening hopes for an economic rebound after last year’s record contraction. (Reuters)


Spritzer: Buys agriculture land in Taiping to set up new mineral water plant. Spritzer is acquiring an agriculture land near its existing mineral water plant in Air Kuning, Taiping for RM76.11m, to set up a new plant. The group said the 1,228-acre land, planted with oil palm trees, belongs to Trong Oil Palm Estates SB. The property is strategically located at Bukit Gantang, Perak. (The Edge)

Aneka Jaringan: Wins RM29m piling job. Aneka Jaringan Holdings has won a RM28.9m sub-contract for piling work at a new logistics hub in Shah Alam by Nakano Construction SB. This new hub will consist of two four-storey warehouses, a two-storey cafeteria, two guardhouses, a refuse chamber, a Tenaga Nasional substation and utility buildings. (The Edge)

LKL: Export revenue doubles to RM5.6m in 3Q. LKL International export revenue doubled to RM5.6m in the 3Q ended January 31, 2021 from RM2.8m a year ago. This was driven primarily by improved sales of medical and healthcare beds to distributors in Europe, and ongoing deliveries of nitrile and latex gloves to Hong Kong to fulfill export contracts secured in the second half of 2020. (Business Times)

Gagasan Nadi: Profit, revenue drop in FY20. Gagasan Nadi Cergas net profit dropped 50.5% to RM12.51m in the FY20 from RM25.28m recorded in FY19. Its revenue during the same period eased 28.6% to RM206.9m from RM289.63m. This was due to reduced construction billings because of the MCO in the earlier quarters. The company declared a single-tier interim dividend of 0.5sen per share in respect of FY20. (Business TImes)

Yinson: 4Q net profit up slightly to RM67m, declares 2sen dividend. Yinson Holdings net profit grew marginally by 3.08% to RM67m in the 4QFY20 against RM65m reported in the previous corresponding quarter, on the back of higher EPCIC business activities contribution. EPS went up to 6.3sen from 6sen. The group’s quarterly revenue, however, declined by 32.8% to RM1.25bn from RM1.86bn. (The Edge)

TDM: Sinks into red in 4Q, declares 0.29 sen interim dividend. TDM sank into a net loss of RM8.56m or 0.5sen loss per share for the 4QFY20 compared to a net profit of RM21.75m or 1.26sen earnings per share in the preceding quarter. Quarterly revenue grew 6.82% to RM129.7m QOQ attributed by higher revenue at both plantation and healthcare division segments by 2% and 14% respectively. (The Edge)

Eco World: More than double sales in 1Q. Eco World Development Group has recorded RM706m sales in the 1Q ended January 31, 2021. This was more than doubled the RM305m sales achieved in the same quarter in 2020. As at February 28, YTD sales amounted to RM911m, giving the group a good head start for the full financial year FY21. (Business TImes)

Hiap Teck: 2Q profit jumps to RM30m QoQ. Hiap Teck Venture net profit for the 2QFY21 jumped to RM30.05m from RM6.97m in the immediate preceding quarter due to higher sales volume and improved margins in tandem with rising steel prices. Revenue climbed 53.8% to RM356.02m due to higher sales volume and increased selling prices for both the trading and manufacturing divisions. (The Edge)

Market Update

The FBM KLCI might open higher today after the dollar rallied to four-month highs and global equity benchmarks edged higher Thursday as investors looked past rising coronavirus cases in Europe and focused on signs that the US economy was rebounding from the pandemic faster than anticipated. Oil prices sank after surging on Wednesday when a container ship became stuck in the Suez Canal. The ship may block the vital shipping lane for weeks. On Wall Street, the Dow Jones Industrial Average rose 200.81 points, or 0.62%, to 32,620.87, the S&P 500 gained 20.59 points, or 0.53%, to 3,909.73 and the Nasdaq Composite added 15.79 points, or 0.12%, to 12,977.68. The pan-European STOXX 600 index slipped 0.3%, weighed down by a drop in oil and gas stocks on the back of weaker crude prices, and bank stocks as bond yields declined.

Back home, the FBM KLCI shed 4.67 points or 0.29% to close at 1,597.73, while Bursa Malaysia’s Palm Oil Plantation Index fell the most at 1.67%, as crude palm oil (CPO) prices tracked lower crude oil prices. The regional markets finished mixed with the Shanghai Composite gained 1.14%, while the Nikkei 225 led the Hang Seng lower. They fell 2.07% and 0.27% respectively.

Source: PublicInvest Research - 26 Mar 2021

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