KUALA LUMPUR, July 29 (Bernama) -- Bursa Malaysia rebounded to close higher on Wednesday on selective buying of defensive stocks after a volatile trading session. IPPFA Sdn Bhd director of investment strategy and country economist Mohd Sedek Jantan said consumer products and services stocks lifted the key index higher, overcoming lingering geopolitical concerns. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 3.08 points to 1,715.56 from yesterday’s close of 1,712.48. The benchmark index, which opened 1.91 points higher at 1,714.39, moved between 1,710.79 and 1,720.59 during the day’s trading. In the broader market, gainers outstripped decliners 550 to 476, while 612 counters were unchanged, 1,129 untraded, and 48 suspended. Turnover rose to 2.96 billion units valued at RM2.48 billion from 2.94 billion units valued at RM2.56 billion on Tuesday.
Nike withdrew its annual revenue forecast on Tuesday, just as a new CEO is set to take the helm at the sportswear giant, which is facing a holiday season likely to be filled with discounts and weak traffic on its website and mobile apps.
This announcement caused Nike's shares to tumble 6% in after-market trading. Earlier in the day, the company's stock had fluctuated after it reported disappointing quarterly sales growth, although it did manage to beat Wall Street's profit expectations.
Adding to the concerns, Nike has also postponed its investor day, originally scheduled for Nov 19.
Traffic declines across Nike's own stores and websites were more significant than expected, leading to inventory backlogs, according to Nike CFO Matthew Friend during a post-earnings call. Notably, outgoing CEO John Donahoe did not attend the call.
Friend further mentioned that sales dipped despite offering higher promotions through both wholesale and retail partners.
Recently, Nike's growth has been hindered by nimbler rivals such as On and Deckers' Hoka. Last month, the company announced the return of veteran Elliott Hill, who will succeed Donahoe as CEO in an effort to steer the brand back to growth.
Nike's stock has dropped 18% this year but has regained 10% since Sept 19, when Hill's appointment was announced.
By withdrawing its forecast, Nike gives Hill the flexibility to reassess strategies and business trends, as he prepares to position the company for fiscal 2026 and beyond, said Friend. Previously, the company had forecast a mid-single-digit annual revenue decline.
In place of the annual outlook, Nike provided guidance for the September-November quarter, forecasting an 8% to 10% sales decline, which is steeper than the 7% predicted by analysts. It also expects gross margins to fall by 150 basis points.
"We expect the return to strong growth will take time," said Friend, "but we believe we have all the right building blocks, especially with Elliott now leading us."
One of Hill's key tasks will be to rebuild Nike’s wholesale partnerships, which had diminished under Donahoe's focus on driving sales through the company’s own stores and websites. This strategy had led US retailers like Foot Locker and Dick's Sporting Goods to replace Nike products with those of fashionable competitors.
Nike’s total net revenue for the first quarter dropped 10.4% to US$11.59 billion, slightly worse than the 10% decline forecast by analysts.
Analysts, including Dave Wagner of Aptus Capital Advisors, remain skeptical, noting the company has yet to see the benefits of its efforts to fast-track innovation and revive demand through new product launches like the Air Max Dn and Pegasus 41.
"I'm pretty disappointed by the revenue number here," said Wagner, adding that the cancellation of the investor day was also a concerning signal.
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