Little to excite the FBM KLCI

Last Friday, Bursa Malaysia closed just 1.2 points higher after BNM reported the country’s GDP growth for 3Q19

by SHAZNI ONG/ pic by TMR

THERE are just over 40 days left before 2019 ends, and the trading performance of Malaysia’s top 30 counters continues to be uninspiring, with the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) having declined 5.67% year-to-date (YTD).

Last Friday, Bursa Malaysia closed just 1.2 points higher after Bank Negara Malaysia (BNM) reported the country’s GDP growth for the third quarter of 2019 (3Q19) at 4.4% versus 4.9% in 2Q19, primarily attributed to lower exports growth and a decline in mining and construction activities.

The key index had opened 0.24 of-a-point better at 1,593.79 and hovered between 1,592.22 and 1,596.85 throughout the day.

Malayan Banking Bhd (Maybank) eased one sen to RM8.66 and Public Bank Bhd fell six sen to RM19.90, while Tenaga Nasional Bhd increased eight sen to RM13.68 and Petronas Chemicals Group Bhd (PetChem) was four sen higher at RM7.44.

Among the actives, Sapura Energy Bhd inched up one sen to 30 sen, Bumi Armada Bhd gained 3.5 sen to 52.5 sen, DGB Asia Bhd slipped 1.5 sen to 15 sen and Priceworth International Bhd shed halfa-sen to four sen.

Top losers included Nestle (M) Bhd which fell RM1.30 to RM143.70, and Petronas Dagangan Bhd fell 20 sen to RM23.76.

For the top gainers, Fraser & Neave Holdings Bhd jumped 26 sen to RM34.86, and IHH Healthcare Bhd increased 11 sen to RM5.50.

Local and international developments are expected to influence the movements of key companies this week.

Hong Kong confirmed last Friday its first recession in a decade as GDP growth contracted 3.2% for the 3Q, weighed down by increasingly violent anti-government protests and the escalating US-China trade war.

Globally, sentiment remains clouded by slow progress in the Washington-Beijing trade talks.

Some of Malaysia’s largest companies have lost billions in market capitalisation YTD as domestic and global uncertainties continue to hamper investment decisions, export activity and consumer sentiment.

Firms with declining market value include Public Bank (lost RM18.63 billion), Maybank (lost RM7.37 billion), British American Tobacco (M) Bhd (lost RM5.39 billion), Petronas Gas Bhd (lost RM5.38 billion) and Hong Leong Bank Bhd (lost RM4.88 billion)

Meanwhile, major gainers in market value YTD include Telekom Malaysia Bhd (gained RM4.12 billion) and Gamuda Bhd (gained RM3.74 billion).

As the earnings season continues, here are some of the notable results and their effects on the respective counters.

PetChem

PetChem recorded its steepest share price decline in close to four years after a weak 3Q19 showing, with the petrochemical market expected to remain challenging on moderating global growth and potential oversupply.

PetChem’s net profit fell 54% year-on-year (YoY) to RM553 million in 3Q19 from RM1.21 billion previously, largely owing to compressed margins and lower overall average product prices amid declining oil prices and softer market demand.

Revenue declined 24% YoY to RM3.67 billion from RM4.83 billion last year due to lower product prices.

The stock fell 5.4% to RM7.38 last Wednesday following the results release, although it recovered marginally to close at RM7.44 last Friday.

The group has lost around RM15.12 billion in market value YTD.

SP Setia

SP Setia Bhd’s net profit jumped 67.1% YoY to RM108.93 million in 3Q19 from RM65.19 million a year ago, contributed by an RM37.8 million foreign-exchange gain.

Its earnings per share for the quarter was, however, lower at 1.06 sen, compared to 1.67 sen registered in 3Q18.

The property developer’s quarterly revenue also fell 6.14% YoY to RM932.07 million from RM993 million in the same period last year, when it completed and handed over the Australian project, Maison Carnegie.

Shares in SP Setia fell 5.4% last Wednesday after the group announced its quarterly earnings. YTD, the stock is down 20.6%.

Dialog Group

Dialog Group Bhd’s net profit rose 43.6% YoY to RM164.64 million in the 1Q ended Sept 30, 2019 (1QFY20), from RM114.64 million recorded the year prior, on healthy performances across its business operations.

However, the integrated technical service provider’s revenue declined 6.5% YoY to RM645.76 million in 1QFY20 from RM690.89 million previously.

Shares of Dialog fell 0.3% last Monday following the release of its quarterly results. YTD, the stock is up 10.3%.