KUALA LUMPUR, July 30 (Bernama) -- Bursa Malaysia's key index closed at an intraday high today, supported by continued buying interest even as renewed geopolitical tensions and a weaker overnight lead from Wall Street following the US Federal Reserve's (Fed) decision to stand pat on interest rates weighed on broader sentiment. The Fed has decided to hold rates steady for the fifth consecutive meeting, with the Federal Funds Rate unchanged between 3.50 per cent and 3.75 per cent. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 4.84 points to 1,720.40 from yesterday’s close of 1,715.56. The benchmark index, which opened 1.14 points lower at 1,714.42, hit its lowest level of 1,710.69 in early trade before gaining momentum for the rest of the day. However, the broader market was negative with losers outpacing gainers 581 to 411, while 612 counters were unchanged, 1,173 untraded, and 87 suspended. Turnover declined to 2.49 billion units valued at RM2.25 billion from ...
Shares of Reece Ltd (ASX: REH) collapsed as much as 22% on Monday — the sharpest single-day drop since 1978 — after the Australian plumbing supplies company reported a sharp fall in full-year profit and flagged prolonged weakness in the US housing market.
Earnings Miss and Market Reaction
Net profit: Fell 24% YoY to A$316.9m (US$205m) for the year ending June 30, missing analyst expectations.
Revenue mix: The US accounted for 57% of total sales, making the group heavily exposed to America’s housing cycle.
Market response: Shares plunged to their lowest in years, as investors digested the cautious guidance and deteriorating US demand outlook.
US Housing Overhang
Reece anticipates the US property market will remain constrained for the next 12–18 months, citing affordability challenges and tighter financing conditions.
Its warning echoes recent profit downgrades across housing-related firms:
James Hardie Industries: Saw its worst trading day in five decades last week after warning of slowing property demand.
Reliance Worldwide Corp: Shares tumbled after the plumbing group flagged a sluggish sales outlook.
This series of downgrades underscores how higher mortgage rates and affordability pressures are reshaping the US housing sector and spilling into building materials and supply chains.
Analyst Commentary
Citigroup’s Samuel Seow described Reece’s results as “reasonable in a tough environment,” but stressed that US macro headwinds remain a key concern.
Investment Takeaways
Earnings risk: With over half of revenues tied to the US, Reece’s earnings remain highly sensitive to US housing and construction trends.
Valuation pressure: A record single-day fall suggests investors are rapidly repricing growth expectations.
Sector readthrough: The slump reinforces a negative near-term view on Australian building suppliers with heavy US exposure.
Comments
Post a Comment