Bursa Malaysia Trader

Masteel Signed Agreement With Stemcor Australia

2009-10-28T06:57:00.000-07:00

Last minute buying on CIMB and Tenaga helped to push the FBM KLCI out of the red and inched up 0.38 points to close at 1,260.3. Today’s corporate news flows includes: Sunway City Bhd has entered into a partnership to develop RM2.5bn worth of property projects in China, Scomi Marine has acquired a anchor handling vessel for US$15m, Masteel has signed an off-take agreement with Stemcor Australia for the sale of RM120m worth of steel bars, Titan Chemicals’ 3Q09 net profit rose by more than 14-fold on stronger margins and write-backs, Temasek has proposed to delist LKT Industrial Bhd, Tenaga and PT Perusahaan Listrik Negara may jointly invest US$300m to build a power line connecting Malaysia to Indonesia, the Government is expected to decide on the implementation of GST before year-end and Miti is expected to reveal details on the reviewe National Automotive Policy today. Overnight, the Dow edged up a marginal 0.14% as the positive trend in home prices was offset by weaker than expected consumer confidence data. The local bourse may trade sideways while awaiting fresh leads, with the focus on the upcoming results reporting season.

Quiet Ahead Of Budget Day

2009-10-22T22:54:00.001-07:00

Shares on Bursa Malaysia drifted in directionless trading, with the FBM KLCI moving in and out of positive territory throughout the day and ending at 1,260.02, down 0.04 pts. Today’s key highlights include Bank Negara’s international reserves rose to RM334.2bn, Malaysia Airports may give cash incentives, Green Packet is set to secure a WiMAX broadband licence in Singapore, Bumi Armada buys vessel at US$46m, Notion VTec proposes a private placement and CIMB-Mapletree buys Patimas Computers’ HQ for RM60m. Overnight, the DJIA raced up 131.95 pts to 10,081.31 as better-than-estimated earnings from Travelers Co to McDonald’s Corp fuelled speculation that the worst recession since the 1930s is over.

Daily Commentaries 22nd October 2009

2009-10-21T21:59:00.000-07:00

The FBM KLCI retreated by 5.7 points yesterday as profit-taking set in for regional bourses following the Dow’s overnight loss. Losers beat gainers by 519 to 214 with volume standing at 926m shares. The corporate news include Sunway Holdings entering into a JV with LCL Corp for potential interior fit-out jobs in Abu Dhabi, Genting Malaysia completes the subscription of Wynn Resorts’ First Mortgage Notes for US$15m, CIMB disposes of Sathorn Building for about RM100m, and Pelikan to raise RM189m via a 1-for-2 rights issue. Crude oil rose to US$81 per barrel on further dollar weakness, with the dollar index falling to 75.3 points, its lowest since August last year. The Dow again fell below the 10,000-point level, dragged down by financial stocks. This should result in further weakness in Asian bourses today.

Axis REIT 3.7% Increase In Net Profit 3Q 2009

2009-10-21T03:46:00.000-07:00

The benchmark FBM KLCI closed 4.25 points higher at 1,265.7, underpinned by follow through buying on financial and plantation stocks. Positive spill over effects from strong regional performance and overnight gains on Wall Street fuelled buying momentum in the local bourse. Today’s notable headlines are Bank Negara reaffirming its confidence in the RM, stating that intervention in the Ringgit market was unnecessary, Media Prima has finalised the sale of its loss making Philippine subsidiary for RM54m, Perodua managing director Abdull Hafiz Syed confirmed that he will not be renewing his contract which expires this December, while Perodua has also revised upwards its sales targets for 2009 by 2.5%,. Meanwhile, Masteel has sealed a deal with Stemcorp Australia worth millions of Ringgit to export steel to Australia, Pos Malaysia launched a strategic partnership with Affin Bank, AlRajhi Bank and EON Bank, and Axis REIT posted a 3.7% increase in net profit for 3Q09. Overnight Wall Dow Jones closed 50.6 pts lower to settle at 10,041.5 on the back of skeptism of the strength of the economic recovery amid the poorer-than-expected results from selected heavyweight corporates.

Another KLCI New High For The Year 20th October 2009

2009-10-20T05:43:00.000-07:00

The benchmark FBM KLCI garnered strength to close above the near term resistance of 1250 pts, spurred by trading interest on second liners and expectations of better earnings performance from the US markets and improved GDP data from China for 3Q09. Among the notable domestic headlines are RHB Capital acquiring an 80% stake in Indonesia's Bank Mestika for US$329m, MAHB hopes to conclude talks for the management of airports in Middle East and Africa in 6 months and the Sarawak government offering RM2.65/share to take Sarawak Energy private. Overnight, the Dow reclaimed the 10,000 pt-level while crude oil steadied at US$79 per barrel. Investors will continue to take heed of more results due this week from the US, particularly from the retail sector to gauge the strength of the economic recovery.

Daily Commentaries 19th October 2009

2009-10-18T22:51:00.000-07:00

The FBM KLCI ended higher by 9.91 points at 1,256.77 in tandem with bullish sentiment on the global market’s performance. The Securities Commission has rejected Tradewinds (M) Bhd’s application for exemption from making a mandatory general offer for Bernas. Bursa Malaysia’s 3QFY09 net profit of RM30.8m was 52.4% higher y-o-y, contributed by trading revenue from the securities market. RHB Capital Bhd has requested its shares to be suspended today, possibly in relation to a regional M&A. Finally, US stocks closed lower on Friday after disappointing results from General Electric Co and Bank of America Corp, indicating that the economic recovery may take longer than expected. Crude oil price, however, ended higher by US$0.95 to US$78.53 on a weaker US$.

EPF Might Pay Higher Dividends 2009

2009-10-15T20:08:00.000-07:00

The FBM KLCI edged up 0.02-point to 1,246.86 as investors took profit after early gains. The key highlight include the EPF considering paying higher dividend provided there is no market disruption in the next 3 months, motor vehicle sales dip 5% m-o-m, Nam Cheong gets a US$22.5m Viet vessel deal, DBE acquires 51% of rival for RM30.6m, Public Bank’s 3Q net profit of RM639m came in largely in line with estimates and Supermax’s 3Q net profit almost tripled to RM40m. Overnight, the DJIA rose 47.08 pts to 10,062.94 as energy shares gained after oil climbed to a one-year high, helping the market reverse an early drop triggered by earnings at Citigroup Inc. and Goldman Sachs Group Inc. that disappointed some investors. We expect the local bourse to trade sideways while waiting for fresh leads, with immediate resistance and support at the 1285 pt and 1231.5 pt-levels respectively.

Daily Commentaries 15th October 2009

2009-10-14T19:22:00.001-07:00

The FBM KLCI took out its Monday high of 1238 pts to hit another record high for the year at 1246.8. The 13-point gain was primarily driven by banking stocks such as Maybank, CIMB, Public Bank, RHB Cap and Hong Leong Bank. Turnover was a respectable 1.26bn, with gainers beating losers by about 3 to 1. Meanwhile, crude oil hit US$75 on further dollar weakness. In the news are the Japanese central bank, which kept its interest rate unchanged, Magna Prima buying 2.43 ha of leasehold land in Selayang land for RM16.5m, Sime Darby to issue RM4.5bn of Islamic bonds, Litrak saying it is open to a takeover proposal, and TRC Synergy wins an Aussie job worth RM12.9m. With the Dow closing 144 points higher and breaching the 10,000-pt mark for the first time this year, the local market should open strongly today but could well see profit-taking setting in later in the day.

FKLI Trading 14th October 2009

2009-10-13T22:05:00.000-07:00

In spite of the modest advance at Wall Street, Malaysian index futures began the day slightly lower and fluctuated between positive and negative territory on bottom-fishing activity offsetting profit-taking selling pressure. In subdue trade, traders seemed to have taken a breather taking its cue from the lackluster regional peers following the recent rally that propelled KL index futures prices to 2009 high of 1243 on Monday. Nevertheless, the underlying tone of the cash market was pretty firm, thus cushioning the downside. At the close, October contract eased 3 points lower at settle at 1234.5. With upward thrust decelerating, there is a possibility index futures will trip into consolidation mode temporarily this week. However, any pullback may be shallow and brief as sentiment remains upbeat though players are sitting on the sidelines as reflected in daily thin turnover. Overnight, Intel's Q3 earnings that surpassed analyst's expectations failed to soothe jitters sparked by Goldman's downgrade by influential analyst Meredith Whitney. For the coming sessions, the immediate overhead resistance is pegged near 1241 level. As for the downside, current support is anticipated at 1230 index points.

Green Packet To Expand WiMax To East Malaysia

2009-10-13T19:57:00.000-07:00

The FBM KLCI closed 0.18 points higher, spurred by late bargain hunting on selected heavyweights. Today’s headlines are Media Prima is in the final stages of disposing of its loss-making TV operations in the Philippines, Berjaya Corporation to inject Cosway Holdings into its 49%-owned Berjaya Holdings (HK) Ltd for RM900m, and Green Packet Bhd has obtained approval to expand its WiMax services to East Malaysia. Overnight, the DJIA lost 14.7 pts to 9,871.1 as banking shares fell, led by Goldman Sachs, as the market may have partially priced in the strong upcoming results, leading to some profit taking. We expect the market to remain range-bound today, with key support at the 1200 pt-level.

Daily Commentaries 13th October 2009

2009-10-12T19:17:00.000-07:00

The FBM KLCI closed 0.49-point lower, largely as a result of profit taking on CIMB. Today’s headlines are Malaysia’s August IPI declining 5.7%, Perisai forming a JV with Gryphon Energy for MOPSU related activities in the region, Zecon securing a RM182m construction contract, Rin Kei Mei emerging as a substantial shareholder of Perstima with a 32.8% stake, and Tradewinds’ board of directors have approved the acquisition of a 31.5% stake in Bernas. Meanwhile, Silk Holdings has had its PN17 status lifted. Finally, US stocks closed mixed and crude oil price was up marginally by US$1.26 at US$73.03. Meanwhile, CPO price gained RM62 to RM2,147 on bullish export data for the first 10 days of October.

FKLI Trading 12th October 2009

2009-10-12T04:24:00.000-07:00

Steady buying support on blue-chip counters kept KL index futures afloat buoyed by mounting optimism about the global economic recovery. Earlier last Friday, futures prices propelled to a fresh high for the year at 1239.5 before retracing mildly to settle at 1238, up 4 points on the day. For the past week, KL markets came back to life on renewed optimism buying in step with Wall Street advance after Alcoa, a heavyweight component stock of DJIA, released betterthan expecting earnings. On daily basis, KL index futures extended its upward thrust for 5 consecutive days Chart wise, the current trend appears bullish but turnover has been relatively thin, implying many traders are sitting on the sidelines possibly on worries that the market has gotten too far ahead of the recovery. For the coming week, anticipated earnings optimism by JPMorgan, Goldman Sach, Intel, IBM and Bank of America, and a slew of economic data slated for release this week could well assess the pace and magnitude of economic recovery. With Wall Street having hit a closing high for 2009 last Friday, this should pave the way for more upward scaling towards 1247 level. Downside support is now raised to 1235.

Daily Commentaries 12th October 2009

2009-10-12T04:22:00.000-07:00

The FBM KLCI ended higher by 3.73 points to close at 1,233.82 amid bullish sentiment following Wall Street’s performance. DRB-Hicom Bhd is bidding for a 32% stake in Proton Holdings Bhd and Supermax will raise the selling prices of its gloves starting from the December shipment. Naza is looking to produce Peugeot cars for markets beyond Asean while Lembaga Tabung Haji has subscribed for a total of RM216m in Islamic preference shares offered by Bank Islam Malaysia Bhd and left unsubscribed by Dubai Financial Group LLC. Elsewhere, three local Islamic banks are preparing to set up their operations in Bosnia by year-end while Malaysian contractors have secured a total of 16 projects worth RM3.7bn YTD. Finally, both US stocks and crude oil price ended higher, with oil price marginally higher by US$0.08 to US$71.77.

FKLI Trading 9th October 2009

2009-10-08T19:12:00.000-07:00

Index futures continued its fourth day of gains on cash-led futures-buying momentum to hit another record high for this year. Against a positive ambience from abroad as Wall Street pointed to a higher start after Alcoa Inc. posted better-than-expected earnings, thus giving hope for a strong third quarter earnings season, index futures advanced 1.5 points at the opening print. Trading was lackluster in the morning but the momentum picked up later with shortcovering activity leading the market higher. By the close, October contract surged 10.5 index points to settle marginally off day's high at 1234. With market having traced out higher lows and higher highs in recent days coupled with DJIA overnight surge, futures market has the propensity to encourage further advance towards 1244 with further upside potential hinged on follow-through buying in the cash market. Profit taking selling ahead of the weekend should see
downside support near 1226 level.

FBM KLCI At Year's High

2009-10-08T19:09:00.000-07:00

FBM KLCI ended yesterday at the year's high of 1,230.09, or 11.48 pts higher, spurred by a late buying spree in most heavyweights. Today’s key news highlights are Proton in talks with India's Hero Group to build small passenger cars for the Indian market, Port of Tanjung Pelepas eyes up to RM2bn sukuk, Genting to raise RM1.6bn via MTN, TM wins a RM170m contract, Petronas unit teams up with Gazprom to explore opportunities in on LNG terminal business, Naza to assemble another Peugeot model locally, Ogawa appointed as sole distributor for V-Patch analyser and Top Glove’s 4Q09 net profit more than doubles to RM56.8m. Overnight, the DJIA gained 61.29 pts to 9,786.87 as Alcoa Inc. started the earnings season with an unexpected profit and jobless claims decreased more than forecast. We believe this may lead spur sentiment on the local bourse today. The market’s immediate resistance lies at 1,231.5 pts, followed by the 1,242 pt- level.

FKLI Trading 8th October 2009

2009-10-07T23:34:00.000-07:00

In line with most major markets advance, KL index futures opened firmer on follow-through interest but the momentum tapered off soon as traders seemed reluctant to make significant moves ahead of the start of earnings season, led by Alcoa Inc, the largest US aluminum producer. Despite recent days steady performance, buying interest remains lukewarm and volume stays low, reflecting a sense of caution in the marketplace. Nonetheless, we reckon that
KL index futures ability to remain above 1200 point should set the stage for more climbing going forward. At the close, October contract edged 6 points higher to settle at 1223.5.

For the moment, KL market seems stuck in range bound trading pattern and it will take some very significant news to break out and then maintain the direction. For the coming sessions, expect futures to remain confined within 1217 to 1227 trading band.

RM28 billion Bid For High Speed Rail Project

2009-10-07T23:32:00.000-07:00

With the regional bourses closing 1% to 2% higher, the FBM KLCI managed to eke out a gain of nearly 6 points to 1218.61. Market breadth was positive, with 479 gainers against 178 losers on volume of 879m shares. After chalking up gains in the previous 2 days, the US market retreated 5 points last night. Crude oil also retraced to below US$70 with the US dollar’s rebound. Among the local headlines, Tenaga is to buy renewable power from Pesaka Technologies for RM14.89m per year for 21 years, and privately-held Global Rail and its Chinese partner have submitted a RM28bn bid for a high-speed rail project to link economic corridors, airports and seaports.

Top Glove To Sustain Buying Interest

2009-10-06T19:55:00.000-07:00

The FBM KLCI dipped 3.72 points to close at 1,212.7 as a correction in KLK’s share price following previous day’s trading error dragged the plantation index down. Expectation of a strong set of results from Top Glove continued to sustain buying interest on rubber glove stocks. Today’s headlines include conflicting news reports on the winner of the bid for the exclusive rights to broadcast the English Premier League in Malaysia, with The Star reporting that Astro is believed to have won the bid for RM800m while the Edge Financial Daily said ESPN is instead believed to have won the broadcasting rights, Khazanah has invested RM516m for a 25% stake in a new Dubai-based investment firm, KWAP has emerged as a substantial shareholder of WCT with a 5.11% stake, and Malaysia Retail Association has forecast a 1-3% growth for Malaysia’s retail industry for 2009. We expect the market to remain firm, with key support at the 1200 level as the Dow ended higher overnight on optimism of a sustainable economic recovery.

FCPO Trading 7th October 2009

2009-10-06T19:38:00.000-07:00

FCPO closed 2062, up 20pts Tuesday. Palm oil registered a volatile price
movement as prices broke the immediate support of 2020 and later created new highs for the day in the second half. Prices rebounded towards 2070. If prices continue to sustain, next target would be 2100. Immediate support at 2013 followed by a stronger one at 2000.

FKLI Trading 7th October 2009

2009-10-06T19:34:00.000-07:00

KL index futures opened marginally lower but losses were limited as spillover buying momentum from previous day stirred some speculative buying interest. Despite a subdued underlying market weighed down by palm oil plantation counter, in particular KL Kepong, futures prices inch steadily higher in line with positive showing across major global markets.

Adding on to the feel good vibes, Australia became the first major country to raise interest rates since the onset of the financial crisis last year, fuelling optimism that other economies might also be growing. In range trade, October contract edged 1.5 index points higher to finish the day at 1217.5. With little leads from the domestic macro side, most traders would remain fixated on external development which will continue to dictate price movements. Following a strong close in Wall Street for the 2nd consecutive day, KL index futures looks set to trade on upward bias within 1215 to 1228 levels.

FKLI Trading 6th October 2009

2009-10-05T20:20:00.000-07:00

Following a couple of US 'shock waves' that sent investors around the region running for cover last week, KL index futures continued to trade
sideway on extended consolidation, flirting within a 5 five-point band of 1203 and 1208 for most part of trading sessions yesterday. Trading was lackluster as
players were not willing to bid-up prices while regional markets remained cautious, awaiting for clearer direction to emerge. Subsequently, futures advanced on
speculative and technical buying yesterday into the last hour of trading boosted by the firmer underlying cash index, notably palm oil plantation counter KLumpur
Kepong. At close, October contract settled at intraday high of 1216, up 12 points.
Despite upside momentum still weak, the market held up well and showed resilience near 1200 psychological marks. Coupled with DJIA overnight bounce from a
4-day losing streak after a report showed the first growth in the service industry in a year, bargain hunting ahead of upcoming earnings optimism seems set to
solidify the upbeat sentiment with downside support pegged at 1208. To the upside, initial overhead barrier is targeted at 1225 level.

Erroneous Trade Involving KLK

2009-10-05T20:17:00.000-07:00

The FBM KLCI closed firmer yesterday on the back of key blue chip support. Some of the notable headlines for today are the Government denying Plus is up for sale, TA Enterprise set to venture into the venture capital industry, Bina Puri wins a RM185m job and KNM receiving orders worth RM155m from international clients. MISC also partnered a Vietnamese company to build a FPSO in Johor. We expect the market to remain range-bound with key support at the 1200 pt-level, with the Dow halting a 4-day losing streak to close higher overnight. There should be a short term retracement in the morning arising from the erroneous trade involving KLK yesterday which caused the share price to surge 24% in the last few minutes of trading yesterday.

FKLI Trading 5th October 2009

2009-10-04T23:25:00.000-07:00

As Dow suffered its worst one-day fall in three-months, stocks and commodities around the world dropped and the yen rose on speculation
rising unemployment will dampen the global economic recovery. Similarly, KL index futures reacted negatively and drop start near intraday low of 1198.5, but
managed to claw back above 1200 points psychological mark within the first hour into market open. Tracking the steady performance of underlying cash, the
October contract shed a minor 4 points to finish the day at 1204. For the week, futures lost a sum of 17.5 index points against 1221.5 the previous Friday.

Last Friday, US stocks fell for a fourth day and the dollar slump increasing speculation that Fed Reserve may postpone the withdrawal of monetary stimulus as the
economy struggles to recover. We reckon players will continue to indulge in bottom-fishing accumulation near 1200 index points as the market had managed to
bounce-off that level on couple of occasions. Upside resistance is targeted near 1211 level.

Digi Plans To Return Excess Cash To Shareholders 5th October 2009

2009-10-04T22:35:00.000-07:00

The FBM KLCI ended lower by 2.10 points at 1,206.25, with selling pressure across the board. For today, Digi plans to return excess cash to shareholders, MAS aims to post an operating profit in 2010 by focusing on enhancing customer satisfaction, generating revenue and intensifying cost-cutting. Heveaboard plans to raise new funds through 42.6m warrants and Proton plans to restore the Lotus brand name. E&O is optimistic about the take-up for Phase 2 its St Mary Residences serviced apartments in view of the recent rally in the Singapore and Hong Kong markets. Meanwhile, Japan’s August jobless rate fell to 5.5% from 5.7% in July while household spending rose, indicating that the country has emerged from its worst post war recession. Finally, both US stocks and crude oil price ended lower, with oil price dropping by US$0.87 to US$69.95.

Daily Commentaries 2nd October 2009

2009-10-03T16:35:00.000-07:00

The FBM KLCI closed 6.27 pts higher to 1,208.35, faring better than most regional markets. Corporate news includes the Naza shareholders not proceeding with a conditional takeover of Kumpulan Jetson as they did not secure more than 50% of Jetson shares, TM and Astro maybe slugging it out for English Premier League rights, Warisan TC in MOU to assemble and distribute Chinese trucks, UMLand and Tradewinds Johor team up to jointly develop a RM718m mixed-use development in Bandar Pulai Jaya, Johor as well as LTH to take up Bank Islam’s preference shares that were not subscribed by Dubai Financial Group. Taking the cue from DJIA’s overnight 203-pt drop to 9,509.28 on a decline in a gauge of manufacturing and an increase in jobless claims, the local bourse may come under the selling pressure today. The FBM KLCI’s immediate support lies at 1,196.5 to 1,200 pts.

Daily Commentaries 2nd October 2009

2009-10-02T00:50:00.002-07:00

Daily Commentaries 1st October 2009

2009-10-02T00:50:00.001-07:00

The FBM KLCI lost 6.13 pts to 1,202.08 on profit taking in both heavyweights and lower liners. Losers led gainers by 466 to 197 while 213 counters were unchanged and 382 untraded. Today’s key highlights include Malaysia and Saudi Arabia forming a US$2.5bn JV to spearhead the flow of FDI from the Middle East, Exxon sells stakes in O&G block to Petronas, Iskandar Investment to award RM2bn worth of projects in the next 12 months, Dubai Investment Group tipped to sell Bank Islam stake, SapuraCrest and Acergy win a US$100m Aussie deal and Lion Corporation’s subsidiary sells Lion Industries stake to Tan Sri William Cheng. Overnight, the DJIA dropped 29.92 pts as an unexpected drop in business activity spurred concern the economy is struggling to recover, which leads us to believe it would be another lacklustre trading day for the local bourse. The Immediate resistance and support for FBM KLCI are at 1,196.5 to 1,200 and 1,231.5 respectively.

Daily Commentaries 30th September 2009

2009-09-30T01:05:00.001-07:00

The FBM KLCI inched up 2.26 points in tandem with regional markets following a rebound on the Dow Jones. The corporate headlines include Asas Serba to finalise a proposal to the Government on the privatisation of the country’s tolls, Berjaya Corporation proposes to relist Singer and 7-Eleven Sdn Bhd, the Government reaffirmed its commitment to the ongoing fiscal stimulus spending, Prime Minister Datuk Seri Najib Razak is expected to reveal a major Middle Eastern Investment in Malaysia, KWAP has emerged as a substantial shareholder in PLUS, Sime Darby has proposed to undertake an Islamic Medium Term notes programme of RM4.5bn, Sunway Holdings has secured a RM147m construction contract from Putrajaya Holdings and Omar Ong of Ethos & Co has been appointed non-executive director of Petronas. Overnight. The Dow Jones slid 47 points after the consumer confidence index came in lower than expected.

Daily Commentaries 29th September 2009

2009-09-28T22:11:00.002-07:00

The FBM KLCI languished for the greater part of the day, closing just off the low of 1204.2 in mixed trading. Aside from a string of results from BLand, ECM Libra and Glomac, the news flow remains thin, save for TSR Capital bagging an RM80m contract from the Federal Government and Petra Perdana selling a vessel for US$2.65m. With the Dow snapping its 3-day losing streak, the local bourse should attempt to overcome the immediate resistance level of 1212. The important US economic data to be released over the next few days, namely the unemployment numbers and consumer confidence, will be closely watched.

Daily Commentaries 28th September 2009

2009-09-28T22:11:00.001-07:00

Last Friday, the FBM KLCI shed 0.67 pts to 1,217.4 pts as most investors were still away for the Hari Raya holidays and investors were cautious after consecutive losses on Wall Street. Market news was thin, with among others, Multi Sports to acquire land and factories in China, AZRB close to securing a RM50m dam-related project, Malaysia Airlines’ CEO dismissed news reports that the company is considering replacing its order for six Airbus A380s with smaller wide-body aircraft as unfounded, Malaysian Bulk Carriers Bhd’s subsidiary buys a vessel for US$23.8m, eBworx buys out SpringWorx and HELP International’s 3Q profit jumps 80%. US stocks fell 42.25 pts to 9,665.19 after disappointing housing and durable goods reports raised concerns that the market’s record six-month rally has outpaced the prospects of an economic recovery. While trading interest is likely to pick up this week as investors come back from the long vacation, the market’s performance will mainly depend on the regional market as we do not expect any major local news.

Daily Commentaries 25th September 2009

2009-09-26T01:12:00.001-07:00

The FBM KLCI ended 1.01 points lower to end at 1,218.06. Moody’s Investor Service has revised the outlook on Maybank’s financial strength rating from negative to stable. DRB-Hicom Bhd is pitching for CKD operations with General Motors while AirAsia X is looking to fly to France next year. Tycoons Tan Sri Quek Leng Chan and Tan Sri Chua Ma Yu have agreed to invest US$80m and US$70m respectively in Wynn Macau Ltd’s IPO on the Hong Kong Stock Exchange. Penang Port’s listing is again on the cards while Jobstreet raised its stake in a Taiwanese online recruitment company. Finally, US stocks as well as crude oil price ended lower, with oil price dropping US$3.08 to US$65.89. US stocks lost ground as an existing home sales report showed a surprise slide and on concern that the G20 summit in the US may signal a gradual reduction in liberal financial policies.

Daily Commentaries 18th September 2009

2009-09-18T04:07:00.000-07:00

The FBM KLCI advanced by another 5.8 points to close at 1218.8 on further improved volume of 877m shares. Market breadth was positive, with gainers beating losers by nearly 2 to 1. Among the regional markets, Tokyo and Hong Kong both gained 1.7% each. Meanwhile, the US market was flat and Europe was just half a percent higher. The news headlines include IJM Corp winning a RM327m award for the construction of a highway in India, KNM Group buys a 50% stake in a company with an Euro220m oil storage contract, Unisem proposes a 10% private placement, SP Setia reported a RM42.7m quarterly profit, General Motors severs ties with DRB-Hicom, Malaysia’s August car sales rose 2.8% y-o-y. Without any major market moving factors, the local market is likely to take a breather ahead of the long Hari Raya weekend.

Daily Commentaries 16th June 2008

2008-06-15T19:17:00.000-07:00

Due to a lack of key market-moving news from the local market, attention shifted to the performance of the U.S market last Friday. DJIA and S&P closed higher by over 1% while Nasdaq registered strong gains of more than 2%. The optimistic tone was established by lower crude oil which closed at USD1.90 / barrel last Friday. Stronger USD also helped fuelled the technical rebound. Technically, the KLCI is still at risk of re-testing the low of 1157.47 pts level as long as the market is still stuck in a downtrend. A dip below the immediate support of 1216 pts level would likely see the key index falling towards the 1157.47 pts level.

Daily Commentaries 13th June 2008

2008-06-12T22:05:00.000-07:00

The KLCI was further pared down by 3.74pts yesterday in line with regional weakness. For today corporate news includes MAS looking to increase its fuel surcharge in 2 weeks, UEM selling 17.6 ha of land in Nusajaya to a West Asian investor for RM396.4m and unconfirmed news that UEM will also not be securing an automatic concession for the Second Penang Bridge which will instead be tendered out to the highest bidder. With US markets enjoying a modest rebound yesterday, we believe the current 1216 pts support level should hold. Resistance begins at the 1234 pts level.

Daily Commentaries 12th June 2008

2008-06-11T19:26:00.000-07:00

The KLCI lost 1.7 points at 1229.28, weighed down by Genting, IOI Corp, Sime Darby, Public Bank and RHB Cap. Volume continued to be thin at 443m shares. Crude oil surged again last night, rising to $138 per barrel on weaker dollar as well as the US Energy Department’s report that oil inventory fell more than expected. This stoked inflation concerns and the Dow fell by more than 200 points. Headline news: Malaysian Prime Minister said there is no more petrol price hike this year, Asiatic Development entered into JV to develop 45k hectares of oil palm plantation in Central Kalimantan and Bina Puri secures RM81m contract to build condo in Bangkok.

Daily Commentaries 10th June 2008

2008-06-09T19:27:00.000-07:00

The KLCI gave up most of the gains notched last Friday, closing 17 points lower following the sell –down on TNB which knocked 6 points off the index. Headlines today are in the form of higher costing for the 2nd Penang bridge, Yeo Hiap Seng being sued for an alleged breach of a distribution agreement and KUB sealing a ICT contract for schools in Selangor. The KLCI is still at risk of re-testing the low of 1157.47 pts level so long as the index is stuck in a downtrend. A dip below the immediate support of 1216 pts level would likely see the key index falling towards the 1157.47 pts level.

Daily Commentaries 9th June 2008

2008-06-08T18:54:00.000-07:00

Key indices in the U.S market tumbled more than 3% last Friday as crude oil price registered the largest single-day price gain ever, closing at a new record. May unemployment rate in U.S which jumped to 5.5% from 5.0% also dampened buying sentiment. On the local front, Ranhill and LOSB Caymen Ltd. have launched a takeover for the balance 29.6% shares in Ranhill Utilities at RM3.50 per share. There was also rumours of Heitech Padu being taken private by PNB. Our bearish bias view towards the near-term market is maintained. The KLCI is still at risk of re-testing the low of 1157.47 pts level as long as the market is still stuck in a downtrend. A dip below the immediate support of 1216 pts level would likely see the key index falling towards the 1157.47 pts level.

Daily Commentaries 6th June 2008

2008-06-05T19:56:00.000-07:00

While yesterday’s fall in the KLCI was expected, it may have been overdone. With US markets rebounding on better than expected retail figures and the relisting of TNB today, we may see a rebound on the market although upside will be limited. Initial resistance will be at the 1235 pts level. Corporate newsflow was thin as most companies chose to digest the news of the subsidy reduction announcements made by the Government yesterday. Petronas announced that it will pay about RM88bn less in gas subsidies over the next 22 years due to lower subsidies while Ramunia is on course to complete its MMHE deal. PanGlobal plans to sell its insurance business to Tokio Marine for RM15m while Ho Wah Genting has secured a 10 year tin mining certificate in Hulu Perak. The fuel rebates of RM625 and RM150 offered to car and motorcycle owners are a one-off rebate pending further deliberation. Finally, Mudajaya has secured a RM958m expressway contract.

Daily Commentaries 5th June 2008

2008-06-04T23:24:00.000-07:00

The steep hike in petrol prices and unexpected hike in gas prices and flows though effect on electricity tariff and consequently inflationary pressures is likely to have an immediate knee jerk effect on the KLCI performance today. Key highlight of new fuel subsidy structure includes: Pump price has increased by 78sen, RM625 rebate for private vehicle registration up to 2,000cc and 2,500cc for pick up tucks, price of gas for the electricity sector will be increased to RM14.31mmBTu from RM6.40, allowing TNB to pass on the higher cost through tariff revision and IPPs and palm oil producers will be levied a 30% and 15% windfall tax respectively on profits above certain threshold indicators.

Daily Commentaries 4th June 2008

2008-06-03T18:58:00.000-07:00

As expected, the market continues to slide in the absence of fresh leads as investors anxiously await the revelation of the new fuel subsidy scheme today. Other notable headlines are Petronas suing India’s Andani Energy for US$100m, Tenaga saying that it will not overpay for Genting’s power assets and a possible 5% windfall tax to be levied on IPPs. The country’s export growth for April also came in a stronger than expected 20.9% yoy due to higher shipments of crude palm oil and petroleum products. We would expect the market to range bound today with immediate support still at the 1260 level. The lower overnight close on the Dow should continue to dampen regional sentiment.

Daily Commentaries 3rd June 2008

2008-06-02T18:46:00.000-07:00

The 1270 level proved to be a weak support for the KLCI which finished the day 13 points lower on renewed selling pressure. For today, the construction and building materials sector is likely to feel the pinch from the abolishment of ceiling prices for cement. The new subsidy scheme for fuel is set to be announced tomorrow with pump prices likely to be raised in August. CIMB also proposed a RM8.6bn merger of its banking units, Bank Lippo and Bank Niaga in Indonesia. Meanwhile, MAS is also biting the bullet on high fuel prices by implementing a slew of cost cutting measures that will take effect immediately. Other corporate headlines (i) Crest Builder inking a RM169m contract to build a service apartment and (ii) Pelikan to finalise potential acquisitions in China after 2008. Given unabated concerns on inflationary pressures and a barrage of negative news out of the US, the market may see further downside today with next support seen at 1260.

Daily Commentaries 2nd June 08

2008-06-01T18:53:00.000-07:00

Stocks such as Gamuda and Berjaya Land which have major property developments in Vietnam faced strong selling pressure due to the country’s sharply deteriorating macro picture. Nevertheless, overall market sentiment was not affected as the KLCI still managed to find its way back above the key 1270 pts level. News on Fitch raising its foreign and local currency senior unsecured debt ratings on TNB from BBB to BBB+ on above-average recovery expectations could attract buying interests on the stock today. Another major corporate news is that LCL is close to securing the first few packages of a major fit-out project for Dubai’s Meydan Racecourse. Today, we will see if the KLCI could sustain above the 1270 pts level. If the key index can continue to trade at above this level, it would mean that last Wednesday’s breakdown was just a fake breakdown.

Daily Commentaries 30th May 2008

2008-05-29T18:55:00.000-07:00

The KLCI closed largely flat yesterday despite the strong GDP numbers reported. For today, with US markets only up slightly but declining oil prices, we feel that the local bourse could face further selling pressure. Bumiputra-Commerce is suspended until Tuesday pending an announcement related to the merger of its Indonesian subsidiary, Bank Niaga with Khazanah owned Bank Lippo. Ramunia secured a RM35m contract by Sarawak Shell while Protasco won a RM81m road maintenance contract in Libya. With the mixed bag of results announced yesterday, the KLCI could well head towards its 1240 pts support level.

Daily Commentaries 29th May 2008

2008-05-28T18:46:00.000-07:00

The KLCI lost 13 points at 1260, falling through the 1271 minor support. Losers beat gainers 2 to 1 on razor thin volume of 400m. Major losers dragging the KLCI lower were Sime Darby, IOI Corp, Maybank, Genting and TM. Corporate news: other than a slew of quarterly financial results, newsflow was thin. 1Q GDP beat forecast, Bank Negara relaxed foreign currency loan, Ireka was given investment certificate in Ho Chi Minh to carry out construction works.

Daily Commentaries 28th May 2008

2008-05-27T19:12:00.000-07:00

The KLCI continues its range bound trading amid external uncertainties and weakness in regional sentiments. Volume was thin at around 433m shares. On the global front, US consumer confidence in May plunged to its lowest in 16 years. Corporate newsflows include Genting rumoured to be selling its power assets while bagging a new PSC in Indonesia, IOI Group’s executive director of finance, Datuk Yeo How’s resignation and Tenaga planning to buy back as much as 10% of its stock. Additionally, Sunrise is believed to be acquiring Wisma Angkasa Raya for a record deal. Technical-wise, immediate resistance remains at the 1305 pts level and support at the 1270 pts level followed by the 1240 pts level.

Daily Commentaries 27th May 2008

2008-05-26T18:43:00.000-07:00

It was another case of a cautious start for the local market after oil prices hit US$132 per barrel last Friday and the Dow taking another beating that culminated in the broader but somewhat restrained sell-down on the local bourse yesterday. The KLCI closed a tad weaker at 1273.37 BNM has kept the OPR unchanged at 3.5% while HeiTech landed a RM20m ICT job from the government. Initial works for the takeover of 4 companies involved in water distribution and production by the Selangor State government has been completed with pricing being the the next hurdle to overcome. In terms of results, both Proton and Kulim registered strong quarterly numbers. On balance, with US markets closed, we would expect the KLCI to extend its range bound trading pattern with concerns still on oil. The index should oscillate within the support and resistance zones of 1270-1305.

Daily Commentaries 26th May 2008

2008-05-25T18:42:00.000-07:00

Following the failure to crack above the 1300/05-resistance area last week, the KLCI has retraced and is in the midst of testing the 1-month low of 1271.42. A breach of which could see the index trying to fill the previous downside gap of 1267.65. In view with the completion of double-top pattern of the 13-day RSI, we reckon the aforementioned scenario is highly probable. As for notable corporate news today, it was reported that Kencana could be getting a RM500m fabrication contract and IJM clinched a RM490m rail deal. We would expect the KLCI to extend its sideways momentum.

Daily Commentaries 23rd May 2008

2008-05-22T20:10:00.000-07:00

The fall in the market was again somewhat muted at 3.63 pts as compared to the steep overnight drop on the Dow the previous night. Volume was thin below 500m shares and we expect the situation to worsen next week with the school holidays. With oil retreating from record highs, US markets closed slightly positive yesterday and our local bourse may take a cue from this. Nonetheless, we expect the KLCI to remain rangebound still between 1271 and 1305 pts. Key news items include the Government stating that the higher income group will need to pay more for subsidized items soon, including fuel. On the corporate front, PDZ announced it was buying a ship for US$14.3m and Bina Puri will be developing property in Sabah worth RM24.8m. Aside from that, results announcements dominate the newsflow.

Daily Commentaries 22nd May 2008

2008-05-21T20:42:00.000-07:00

Despite the sharp fall on the Dow, the KLCI lost just 6 points at 1281 in thin trading of just 531m shares. For the whole of May, the KLCI has been trapped within the 1271 – 1305 range. The direction of the range breakout will determine the short-term direction. Crude oil surged past US$133 on weak supply data and dollar’s weakness resulting in the Dow falling by 227 points. Corporate news: Kosmo Technology Industrial served with letter of demand for RM27.5m by Kuwait Finance House, Global Carriers disposed off a tanker vessel for RM12.3m, Asiatic Development completed the first draft of its palm oil genome sequencing, MMC said there is no cost overrun in its double-tracking rail project.

Daily Commentaries 21st May 2008

2008-05-20T18:45:00.000-07:00

Global inflationary woes, continued domestic political uncertainty and lackluster regional sentiments finally took a toll on the KLCI’s performance, which retraced by more than 1% or 13.04 points yesterday. Renewed consumer concerns in the US following a set of weaker then expected results and guidance from Home Depot and SAKS, coupled with surging oil prices added to the already weakening global economic sentiment. Dow Jones 1.5% overnight decline could weigh on the KLCI’s performance today. Domestic corporate news today includes: Ramunia losing the Indian oil contract after it failed to provide necessary project financing guarantee, Kulim plans to takeover Sindora suffered a setback after its independent adviser advised shareholders to reject the offer of RM1.72/share, MMM has signed an agreement to charter four new chemical tankers in a RM280m deal and Transmile defaulting on its bond repayment of RM213m. Technical wise, look for an immediate resistance at the 1305 pts level followed by the 1313 pts level, while support remains at the 1270 pts level followed by the 1240 pts level.

Daily Commentaries 20th May 2008

2008-05-19T19:47:00.001-07:00

The market finally broke the 1,300 level on selective blue chip support although trading volume remained thin. Key headlines over the long weekend and this morning are the RM15bn investment in Iskandar Malaysia by India- based builder, BSEL, Sime Darby indicating that the Bakun undersea cable project hasn't been delayed while Wijaya Baru has signed a MOU with the Vietnamese authority to bid for infrastructure projects worth US$3bn. Confirming earlier speculation, Intel Capital has inked an agreement with Green Packet which will see the former investing RM50m in the form of convertible bonds. On the political front, Tun Dr. Mahathir has decided to quit UMNO to the surprise of many. EON Capital also revealed a decent set of 1Q numbers. With little by way of fresh leads, the upside on the market could well hinge on the current reporting season where investors would assess the performance of key heavyweights in light of the economic challenges. With the immediate resistance breached, the next resistance is seen at 1313.

Daily Commentaries 16th May 2008

2008-05-15T18:35:00.000-07:00

The KLCI remained stuck below the 1300 pts resistance level yesterday with no major market moving news. For today, the rumour mill seems to be going into overdrive with media reported rumours of Intel potentially buying a minority stake in Green Packet and Boustead Heavy Industries close to clinching a RM200m contract to build a barge. Boustead is offering RM5.50 a share to take Boustead Properties private. News that might affect Sime Darby includes the IMPSA compensation claim for Bakun being termed excessive by the Deputy Finance Minister. Other Government related news includes the Transport Minister saying he will look into the current competition between AirAsia and MAS and the Plantation Industries and Commodities Minister saying that Malaysia may consider swapping palm oil for rice. Coastal Contracts secured a RM201m contract to build 2 offshore vessels while Petra Energy secured a RM50m contract from Felda for palm oil mill boilers. We expect the market to remain rangebound for today given the long weekend ahead. The 1300 pts resistance will remain key.

Daily Commentaries 15th May 2008

2008-05-14T18:28:00.000-07:00

The KLCI rose as high as 1296 but was not able to sustain its gains and closed near the low at 1287. Nevertheless, market breadth was positive with gainers beating losers at 371 to 313. Steel stocks continued to attract buying attention following the recently announced liberalization. Among the corporate news, Maybank registered a marginal drop in quarterly earnings, MAS extends its “Everyday Low Fare” to Asean countries and China, Boustead Holdings to take Boustead Properties the details of which will be announced today, Key ASIC was selected as the design service partner of high performance video scaling and processing chips for Silicon Valley-based Anchor Bay Technologies, Quill Capita Trust buys property in Penang from IJM Properties for RM132m.

Daily Commentaries 14th May 2008

2008-05-13T19:13:00.001-07:00

The KLCI closed lower, led by profit taking on plantation stocks. Technical wise, the market has not completely closed down the massive “downside gap” ranging from the 1243 pts level to the 1296 pts level. Hence, immediate resistance remains at this gap. An additional resistance is seen at the 1313 pts level. To the downside, continue to look for an immediate support at the 1240 pts level. Corporate news today includes: MISC seeking more time to complete the due diligence on its Ramunia acquisition, Ircon International has won the contract to build, design and maintain the RM3.4bn rail project, Mudajaya has secured a RM15m contract and TM said it will invest RM1.9bn over a period of 10 years for broadband infrastructure in the Iskandar Development.

Daily Commentaries 13th May 2008

2008-05-12T18:14:00.000-07:00

The Bursa Malaysia currently exhibits a 2-tier market situation. For instance, PBBANK has recorded a new all time high of RM12.00 while TIME is hovering around its all time low of RM0.215. For the KLCI per se, the index is in the midst of testing the 1300/05-resistance area especially with the help of overnight Wallstreet performance. Nonetheless, the weakness on crude oil could post some selling pressure on oil and gas as well as plantation stocks. Besides, the below-than-consensus results of MISC could possibly drag the performance of KLCI. As for corporate news, KUB Power bags a RM22.5m job and TMC Life to expand its operation in Indonesia.

Daily Commentaries 12th May 2008

2008-05-12T17:34:00.000-07:00

Technically speaking, the KLCI is still in a consolidation mode. The technical indicators have yet to show any conclusive trading signals at the moment. Should the KLCI prove able to hold above the 1275/65 immediate support area, the KLCI could re-test the immediate resistance area of 1300/05 in the near-term. However, due to the weak closing of WallStreet in last Friday night, we do not rule the KLCI to temporary stage a mild correction in the beginning of the week. Apart from the US and regional market performance, we also believe the performance of KLCI also hinge on crude oil’s movement. A strong crude oil performance could fuel the performance of oil and gas as well as plantation stocks that collectively accounted for about 30% of KLCI market cap.

Daily Commentaries 9th May 2008

2008-05-09T19:30:00.000-07:00

The KLCI succumbed to selling pressure yesterday alongside regional markets after the overnight fall on Wall Street, For today, RHB Cap resumes trading after its suspension for the 25% stake acquisition by Abu Dhabi Commercial Bank at RM7.20 per share, Malaysia Airports reported strong growth in passenger numbers for March and Digi plans to expand its presence in rural areas targeting 10m new subscribers. With US markets largely flat overnight, we see the KLCI also trading rangebound with resistance at the 1300 pts level.

Daily Commentaries 5th July 07

2007-07-04T20:24:00.001-07:00

The KLCI chalked up a 4 pts gain on a volume of 1.25bn shares after taking its cue from foreign markets. For today, Boustead announced plans to acquire a 45% stake in Royal & Sun Alliance Insurance (M) Bhd for RM148.8m while Petra Perdana signed a MOA to buy a RM49.7m anchor handling tug. The Plantation Industries and Commodities Ministry is coming out with the National Timber Industry Policy soon to help the timber industry move up the value chain. The shareholder agreement on the Penang Outer Ring Road is ready for submission to the EPU. BAT is raising its cigarette prices be between 8 to 14% after a rise in excise duty on tobacco. On a foreign front, Indonesia has capped new foreign investment in parts of the telecommunications and transport sectors while the buyout of Hilton Hotels by US private equity firm Blackstone Group lifted markets in Europe although US markets were closed for their independence day holiday. Without any negative news today with the exception of the continuing development at Megan Media, we expect the market to continue its run testing the 1380 pts resistance level.

Daily Commentaries 4th July 07

2007-07-03T18:56:00.000-07:00

The KLCI continued its uptrend, testing the 1,375 resistance level. In general, regional markets also closed positive. Ingress has been awarded a RM26.7m transmission installation contract from TNB, while Ekovest has signed a deal with Credence Resources and Danga Bay Holdings to buy the entire shares of Danga Bay Sdn Bhd for RM1.1bn. Tradewinds Corp has denied any group-wide restructuring plan while Bandaraya and Kumpulan Hartanah have denied any privatization plans. Meanwhile, Megan Media Holdings is in the midst of preliminary discussions with its creditor banks to regularise its financial condition and has about seven months to submit its plan to the relevant authorities. The local bourse may take cue from the firm closing on the Dow last night with high crude oil prices as a concern. Immediate support and resistance are at the 1,360 and 1,380 levels, respectively.

Daily Commentaries 3rd July 07

2007-07-02T19:32:00.000-07:00

The market did start on a positive note closing above the previous resistance of 1360 although volume traded was under 1bn, indicating the overall subdued undertone. Banking stocks contributed to the bulk of KLCI’s gains. Headline news today are massive losses posted by both Megan Media and Transmile – both counters will be re-quoted today. Excise duties of cigarettes have been increased to 15sen a stick from 12 sen a stick previously, resulting in a 60sen hike for a 20 stick pack. AirAsia plans for 25 more Airbus A320s, raising the total orders for the said aircraft type to 175. Aside from that, Naim Cendera has secured an RM88m road upgrading job in Sarawak while crane maker, Favelle has landed a deal to supply offshore pedestal cranes to Singapore’s Keppel Fels Ltd. Property companies should benefit more from the latest initiatives to introduce a matching grant of RM100m to establish Malaysia as a property haven. There is room for further upside on the KLCI today with the strong 126 points rally on the Dow last night. Immediate support now rests at 1360.

Daily Commentaries 26th June 07

2007-06-25T20:02:00.001-07:00

As expected, the market did stage a breather with profit-taking on key heavyweights, Tenaga, IOICorp and Maybank weighing on the KLCI. Market breadth was generally mixed with sustained interests on lower liners. News today came in the form of Gamuda's proposed 1-for-1 bonus issue, Tenaga and Eden securing a power plant job in Sabah as part of a consortium and MRCB in a maiden property development project in Penang. In addition, Kencana has bagged 2 contracts worth RM40m while MAS has inked an agreement with Avion de Transport Regional (ATR) for the purchase of turboprop aircrafts for Firefly. Tanjong reported 1QFY08 results that came in below expectations while Gamuda' s 3Q numbers were within. The KLCI is likely to range-bound with the previous support of 1380 acting as the immediate resistance. Support retreats to 1370.

Daily Commentaries 25th June 07

2007-06-24T18:36:00.000-07:00

The KLCI closed above the 1390 level last Friday in what has been a remarkable week with over 20 points gain in the benchmark index. News out of the weekend include Kulim exiting its Indonesian plantations business, Scomi bidding for global jobs worth RM11bn and Hai-O proposing a bonus issue and subsequent transfer to the Main Board. FAX may also see the entry of Virgin Group's Richard Branson as a key shareholder. Aside from that, Magnum told shareholders at its AGM last Friday that it was not contemplating a capital repayment nor plans to take the company private while Bank Rakyat is said to be eyeing a stake in MBSB. The market may take a breather in the short-term to digest recent gains but rotational interests among the lower liners will continue to stir sentiment and sustain the robust trading volumes. On the external front, investors will also be looking for cues ahead of FOMC's meeting in the US come June 27. Stronger support and resistance levels for the KLCI are at 1380 and 1400 respectively.

Daily Commentaries 20th June 07

2007-06-19T19:09:00.000-07:00

The KLCI ended firmer with continued interest in second liners while regional markets closed firmer yesterday. Main corporate news today is AMMB's offer of RM3.70 for the 49% share of AIGB and MAS's new management team to take it to the second phase to turnaround. TM’s CEO said the company’s expansion plan will be driven by demand and expects 3G customer base to accelerate in 2008. Pilecon has signed an MOU with the West Java government to develop water resources infrastructure while Bina Puri secured a RM8.6m contract in Brunei. The KLCI is likely to trade rangebound after Dow’s positive performance last night, testing the immediate resistance of 1,375.

Daily Commentaries 4th June 07

2007-06-04T02:24:00.001-07:00

Despite the modest volume and the expected sell-down on Transmile, the KLCI actually closed 13 points higher on the back of follow through buying of blue chips last Friday. Oil and gas stocks dominated the active list with Deleum chalking a hefty 64% gain on its maiden day of listing. Headlines out of the weekend includes Plus buying 2 highways from parent, UEM Group for RM802m and the government possibly ceding control of Proton in its final bid to find a strategic partner for the car maker. Continuing on the Transmile saga, Khazanah Nasional has ordered a further probe into the air cargo operator while stating that the impact on Pos Malaysia is likely to be small. MOL Access Portal is likely to be the next on Tan Sri Vincent Tan's privatisation list, following that of Nexnews, Berjaya Corp and Cosway. Despite the mixed newsflows, we feel that the KLCI has the tenacity to resume its upward march towards the resistance of 1370.

Daily Commentaries 25th May 07

2007-05-25T21:08:00.000-07:00

The KLCI continued to suffer from profit taking with what appears to be selling pressure from foreign funds. We believe that the market may continue to struggle today given the school holidays next week and some remaining foreign selling. Oil & Gas news seems to be the theme for the day as Ramunia announced a MOU with Indian company Punj Lloyd to collaborate in submitting a bid document for the US$1bn Mumbai High North O&G project, Favelle Favco proposed a move from the Second Board to the Main Board of Bursa Malaysia and Naim Cendera announced the acquisition of a 45% stake in a group of oil & gas companies providing maintenance and marine vessel services for RM87.8m. Alam Maritim also proposed a 3-for-8 bonus issue and a subsequent 1-into-2 share split while Welli Multi confirmed its MOU with Hadhari Cattle Industry to build a state-of-the-art Halal Gelatin Plant. Support remains at the 1335 pts level.

Daily Commentaries 23rd May 07

2007-05-23T00:23:00.000-07:00

The KLCI closed at another historical high, signaling optimism on the health of the government’s revenue and continued strengthening of the Ringgit. Regional markets also ended the day on a positive note. Interest in Ranhill should continue today as the firm is said to be finalising talks with Trans-Peninsula Petroleum Sdn Bhd to develop a US$7bn oil pipeline project across northern Peninsular Malaysia. Further consolidation in the telco industry can be expected as Time Engineering is ready to sell its shares in Time dotCom to resolve its debt, while Telekom has further sold its stake in Dialog. Details on lower LCC terminal charges is anticipated to be announced today while notable corporate results were released last evening: OSKVI, MRCB, CCM, KFC, BERNAS and MOX. Meanwhile, the Second Finance Minister has stressed that the government will not bail out Proton and is still seeking a strategic partner for it while KFC clarified that it has no knowledge of any fresh bid for the shares of QSR Brands. The local bourse will likely react positively to the positive local macro newsflows as well as DPM’s assurance that there are no plans for an increase in fuel prices. Resistance level remains at 1,370 points.

Daily Commentaries 10th May 07

2007-05-10T00:49:00.001-07:00

The KLCI closed down 3.83 pts dragged down by blue chips such as Digi, Transmile and Sime Darby. For today, Oil & Gas counters are still in the news with Muhibbah Engineering securing a RM41.4m contract in Sudan and Kencana Petroleum a RM132m contract to build platform structures offshore Bintulu. Telco shares too are in the limelight with both Time dotCom and Green Packet viewed as potential partners for Digi in broadband services. Nexnews received a take over offer from Net Edge Online SB and Tan Sri Dato’ Seri Vincent Tan priced at RM1.27 per Nexnews share and RM0.27 per Nexnews warrant. Java Incorporated is buying a timber concession in Sabah for RM28m. After its recent consolidation, the KLCI may resume its upward trend today although investors may still feel the jitters arising from the issues surrounding Transmile. Still, the decision by the US Fed to maintain interest rates should give the market a leg up. Support and resistance remain at 1332 and 1380 pts respectively.

Daily Commentaries 18th April 07

2007-04-17T20:51:00.000-07:00

The KLCI closed at another record high on the back of strong buying interest on blue chips despite the weakness in several major regional markets. This was also supported by the continued strong Ringgit as well as MIER’s upgrade of the GDP growth in 2007 and 2008. Steel-related stocks may see some trading interest today as the government raised the price of steel bars and billets by 20% to curb black market activities and ensure sufficient supply locally. Meanwhile, Magnum has denied any plans to return cash to shareholders while General Motors reiterated its interest in Proton. Opus International clarified that it has no conclusive plan to return excess capital to shareholders arising from the proposed listing of its subsidiary, Opus International Consultants Ltd. Although profit taking is imminent, the medium term outlook of the KLCI remains positive, backed by the strong fundamentals. Immediate support for KLCI stands at the 1,300 pts level followed by 1,285 and the 1,250 pts level.

Daily Commentaries 3rd April 07

2007-04-02T19:26:00.000-07:00

While the KLCI managed to sustain its posture in the morning session, sentiment turned decidedly cautious in the afternoon following external concerns and the quake in the Solomon Islands. News today includes Utama potentially making a capital repayment, CIMB taking a 25% stake in Tune Money, MAHB clinching a 10 year deal to manage the Kazakhstan airport and Suria’s proposed 2-into-1 capital reduction. We will not be surprised if the KLCI takes a further breather today with trading likely to remain range-bound. The silver living could come from Dow’s stronger overnight closure which was propelled by M&A newsflows. Support and resistance levels remained at 1222 and 1250 respectively.

Daily Commentaries 28th Mar 07

2007-03-27T21:00:00.001-07:00

The KLCI stayed well above its closing on Tuesday to end the day with 2 points higher yesterday. Top corporate news for today: foreigners are allowed to own 100% stake in Islamic financial institutions in the country while FIC has relaxed some rules to account for this, IJM has signed a RM530mn agreement to jointly develop an integrated township in India, while Muhibbah and Nam Fatt have secured a combined RM1.01bn of the RM1.4bn petroleum hub and bunkering facility near Tanjung Pelepas. The government has clarified that it is still considering YTL’s proposal to build the KL-Singapore high-speed rail and no decision has been made. Two corporate results today are Gamuda and I&P. Despite the continued strengthening of Ringgit, Dow’s tumbled overnight due to worries that the nation’s weak housing market would seep into the broader economy and crimp consumer spending, may hamper sentiment on the local and regional bourses. The next resistance is pegged at 1,250 with immediate support at the 1,220 level.

Daily Commentaries 27th Mar 07

2007-03-26T18:55:00.000-07:00

Despite the overall mixed trading, the KLCI still managed to eke a respectable 8.67 points gain to close slightly off the high of 1246.75. A key market sweetener was the Ringgit which crept to a new 10 year high of RM3.452. Major headlines today includes DiGi's new prepaid plan targeting youths, WCT Engineering clinching a drainage and sewerage construction job for the Dubai airport and Latitude Tree receiving a new substantial shareholder in the form of Konsortium Kontrek. Also, shareholders accepting Wilmar’ VGO for shares in PPB Oil are required to repatriate all dividends, profits and proceeds from the disposal of their investments once they are paid or when they dispose off their investments according to a BNM ruling. There appears to be enough notable newsflows to see the extension of the upside today although the market could well take a breather with oil high oil prices reining on sentiment and the lower overnight close on the Dow. Next resistance is pegged at 1250 while immediate support is now at 1220 level.

Daily Commentaries 22nd Mar 07

2007-03-21T19:51:00.000-07:00

The local bourse gained 4 points in thin trading. Top volume movers were the call warrants and second liners. Among notable headlines today: KFH has indicated its interest in a 49% stake in RHB Islamic; Maybank plans to set up a stand-alone Islamic bank; assurance from Khazanah that Proton’s shareholders are still in talks with VW and GM on a possible strategic alliance; MMC considering a bond issue to finance construction of Ipoh-Padang Besar double-track rail project; and the possibility of Maxis joining Usaha Tegas to buy a stake in Sri Lanka Telecom. KLCI may extend its gains today with two positive news on the macro front: BNM announced sweeping measures to further liberalise the forex policy while Ringgit closed at RM3.47 against the US$. Meanwhile, The Dow rallied last night investors embraced further evidence that the Fed continues to do a good job of engineering the expected soft landing. Immediate resistance and support for KLCI remains at 1,214 and 1,200 level, respectively.

Daily Commentaries 12th Mar 07

2007-03-20T20:18:00.001-07:00

The KLCI stayed well above its previous closing level yesterday in a widely range bound trading. Among top corporate news today are IJM Corp’s idea to raise RM200mn from an IPO of its Indian contracting and property business, Maybank’s plans widen its overseas operations to make it account for at least a third of group revenue by 2010, and QSR may buy the A&W franchise. EPIC has confirmed that it is not in negotiation with the shareholders of Samudra while KUB clarified that it is identifying opportunities in O&G companies. The local bourse is expected to continue its range bound trend, supported by the strengthening of the Ringgit and strong economic fundamentals. News flow on blue chip companies can be expected over the three-day Invest Malaysia event, which will begin today. The Dow ended positive on good overall housing data, more M&A news, and relief in the troubled sub-prime mortgage space. Immediate resistance and support for KLCI stand at 1,214 and 1,200 level, respectively.

Daily Commentaries 20th Mar 07

2007-03-19T20:09:00.000-07:00

Despite the 10 points rise on the KLCI, the broader market was generally weak with trading volume hitting another low of 937m shares. Among key corporate headlines today are Samudra's contract from Petronas Carigali for turbular handling equipment, IOICorp's 1-into-5 share split and TM's revelation of its FY07 and medium-term KPIs. Meanwhile, expectations are running high for the government to scrap the Real Property Gains Tax (RPGT) that may be announced at the Invest Malaysia conference tomorrow. Given the strong rebound on the Dow last night, we do expect the KLCI to trend higher today with the immediate resistance at 1200 level. Support is now seen at the 1159 level followed by 1150.

Daily Commentaries 19th Mar 07

2007-03-19T01:26:00.000-07:00

Trading volume on the market dwindled further last Friday to under 1bn with most investors staying on the sidelines. However, there were no short of newsflows beginning with the much touted award of the WiMAX spectrums to 4 companies, Genting's disposal of its paper and packaging business, Genting Sanyen, Proton is likely to see the emergence of a local partner again in the form of DRB-Hicom while the stalled double-tracking project is back into play. KUB has also aborted the deal to acquire Samudra while MAS is likely to cancel the order for A380s. The rumour mill has been awashed with news of a probable lifting of the Real Property Gains Tax (RPGT) that could fuel further interest on property counters. While external concerns should still cap sentiment on the local bourse, the emergence of fresh leads including upcoming major IPOs- JCY and Bright Focus- should mitigate the downside pressure on the KLCI. Support is at the 1159 level with strong resistance at the 1200 mark.

Daily Commentaries 16th Mar 07

2007-03-15T20:37:00.000-07:00

Uncertainty still reigned in the market yesterday with wide swings in the KLCI. Nonetheless, it did manage to close in the black, up 13.93 pts. Industry watchers will be keenly awaiting the Government’s announcement on the winners of the WiMax licence recipients today. Corporate news includes Telekom Malaysia exploring opportunities to acquire wireless operators in Vietnam and Laos, Ingress announcing that it had received LOIs from TNB to supply electrical equipment and civil works at substations worth RM36.2m as well as Bina Puri securing construction contracts for condominiums in Bangkok worth RM63.8m. With regards to the EPF-RHB deal, EPF is open to Kuwait Finance House as a strategic partner for RHB but its top priority will be to dispose of non-core assets and reduce debts. Bursa Malaysia is also in early talks to buy strategic stakes in the stock exchanges of Vietnam and Indonesia. With overseas markets looking positive, we expect the KLCI to continue creeping up today. The technical view now points to a continuous resistance range from here up to the 1200 pts level while support will likely kick in at the 1159 pts level.

Daily Commentaries 15th Mar 07

2007-03-14T20:36:00.000-07:00

The KLCI’s performance showed that investors are still jittery with the market closing sharply down at 1166.38 pts. Still volume was not significant showing that selling pressure was weakening. Today’s news comes in the form of MAS announcing a new turboprop airline named Firefly, OSK’s offer to buy MBF Corp’s 49% stake in QBE Insurance. We are hopeful that the 1165 pts support level will hold for today.

Daily Commentaries 14th Mar 07

2007-03-13T21:17:00.000-07:00

The KLCI closed at the 1,200 level after it succumbed to profit taking in the second session, wiping-out the 10 points gain in the morning session, while regional markets closed mix. Topping corporate news today are Alam Maritim’s LOI from Murphy for a RM19.2mn contract to supply a fast crew boat, IOI Properties and a Singapore company winning a tender for a 1.46ha leasehold land on Sentosa Island while DiGi has also denied a tie-up with Time dotCom. Meanwhile, the successful recipients of the WiMAX spectrum could well be announced later today. With the Dow plunging 242.66 points overnight following the revelation of weaker than expected retail sales and concerns on the sub-prime mortgage contagion effect enveloping the financial sector, there is further downside on the market today. Immediate support is pegged at 1187 followed by 1150.

Daily Commentaries 13th Mar 07

2007-03-12T19:39:00.000-07:00

The market cruised past the 1,200 level yesterday with strong buying of Genting and Resorts providing the lift. Retailers were also seen snapping- up few Mesdaq and second liners deemed situational beneficiaries. Tanjong Offshore is in the news today with a RM430m contract from Murphy Oil for offshore drilling. PNB is also looking to take MIDF private while Kuwait Finance House (KFH) which lost the bid to take over RHB Group has indicated that it is still keen to have equity participation in the entity. With the firmer overnight close in the US market, oil price staying below US$60 per barrel coupled with the certainty provided by PM’s statement that an election will only be called when the feel good factor improves further, we do expect a continuum of the upside today with the resistance zone at between 1189-1240.

Daily Commentaries 12th Mar 07

2007-03-11T19:41:00.000-07:00

The KLCI did sustain its upward momentum in early trade Friday although much of the gains were pared ahead of the weekend. The Board of EPF has come out to defend the acquisition of RHB whilst revealing plans are afoot to bring in few strategic partners into the banking group. Other key news out of the weekend are the likely success of Melewars's bid for the RM1.2bn Penang monorail project and Scomi's disposal of its oil field subsidiary to Standard Chartered Private Equity. Also, Sapura Crest is reported to have secured a major offshore oil deal worth US$3bn. US markets closed slightly firmer nudged by better unemployment data last Friday. External developments will continue to dictate the patchy recovery in sentiment but there is upside bias for the KLCI given talks of the potential award of construction/9MP contracts. Support is seen at 1150 while resistance zones are eyed at 1190-1240.

Daily Commentaries 9th Mar 07

2007-03-08T18:38:00.000-08:00

Judging from yesterday’s rise in the KLCI of 30.48 pts on a volume of 2bn shares, it would appear that optimism is returning to the Malaysian market. News today includes Utama Group accepting EPF’s revised offer for its stake in RHB, the potential delay of AirAsia X on the lack of suitable planes and CBIP announcing new contracts worth a total of RM29.2m in relation to the construction of palm oil mills. Johan Holdings announced a management agreement to supervise development of a retail project in China with a gross project value of RMB500m while KPJ will manage 2 private hospitals in Jeddah. Leader Universal entered into a JV to build and operate a 200MW power plant in Pakistan. With US and European markets rising overnight, we do see the market sustaining its uptrend. The technical view for today sees a big resistance range from 1190 to 1240 pts. Immediate support is at 1150 pts.

Daily Commentaries 8th Mar 07

2007-03-07T18:59:00.000-08:00

The KLCI yesterday saw another day of active bargain hunting activities on blue chips with the index moving up 27.6 points or 2.7% on decidedly strong volume of 2.7b shares. In today’s headlines, EON Cap has raised its offer for RHB shares to RM1.97 per share from RM1.80 previously and similarly for RHB Cap shares from RM4.80 to RM5.00 per share. Also in the news is the revision of Protasco’s associate’s Libyan road maintenance contract to a higher value, the Sarawak State Government’s revision of electricity tariffs which will benefit Sarawak Enterprise Corporation, Lien Hoe’s proposed sale of the Atria shopping complex to OSK Property for RM75m and APB Resources canceling its HOA with PSC Petroleum. Despite the bullish sentiment yesterday, the overnight drop in US markets may still put a dampener on the mood today. Still, we believe the KLCI may edge higher towards the 1165 pts resistance level.

Daily Commentaries 7th Mar 07

2007-03-06T18:24:00.000-08:00

The market finally clawed back some of the losses chalked over the past week to close 20.2 points higher as bargain hunters returned to snap-up battered blue chips. EPF makes headlines today with a fresh bid made for RHB Capital, competing with the likes of Kuwait Finance House and EON Capital. The rebound on the KLCI following successive declines is a welcoming respite- drawing some semblance of stability- although we remain cautiously optimistic until a more meaningful upside is established. Immediate support and resistance are pegged at 1130 and 1150 respectively.

Daily Commentaries 6th Mar 07

2007-03-05T18:40:00.000-08:00

It was another nerve wrecking start to the week with the KLCI plunging 74 points at one point before recovering slightly to close 53.9 points down. At the close, Malaysia was the worst performing market in the region, shedding 4.6%. In the new today, Peugeot Citroen has ended talks with Proton for an alliance while M3nergy securing an oil and gas block off West Java. Both Putra Perdana and Crest Builder have also secured contracts for mixed developments projects in Kuala Lumpur and Damansara respectively. US markets closed weaker with bargain hunting short-lived by heavy profit-taking driven by continued fears of a global economic slowdown. With the 1136 support broken with relative ease, the next crucial support for the market now rests at 1096. We would expect the market to drift further on its strenuous path before making a recovery attempt.

Daily Commentaries 5th Mar 07

2007-03-04T18:38:00.000-08:00

The market extended its losing streak, closing in negative territory for the 5th consecutive trading day last Friday as selling pressure continued. M&A developments within the banking fold made headlines over the weekend with DRB-Hicom confirming the intention to dispose-off its 20% stake in EON Cap for between RM9-10 a share, EON Cap has extended the deadline for RHB's board to consider its bid for another week until March 9 while ANZ and AMMB have formalized the strategic partnership. Other notable news includes Star Cruises withdrawing from the Singapore IR development, London AIMS- listed Peninsular Gold Ltd. investment in a RM60m high tech gold processing plant in Raub, Pahang while Lim Kok Wing University is headed for a listing. Following the disposal of the Four Seasons Resort in Langkawi, MAS is also now looking to sell its 10% stake in Seri Pacific Corp which owns the Best Western Premier Seri Pacific Hotel in Kuala Lumpur. Given the still fragile investor sentiment amid another weaker close on the Dow last Friday, the KLCI is expected to range-bound at best with the underlying support of 1136 as the critical level to watch.

Daily Commentaries 2nd Mar 07

2007-03-01T18:37:00.000-08:00

As expected, selling pressure continued yesterday although it seemed to have eased slightly with volume dropping to only 2.4bn shares and the 1170 pts support level holding up. For today, corporate news is in the form of Genting International saying that it will ensure that it met all the requirements for a casino license in Singapore including reviewing its Macau deal. Banks are in the news with Bank Negara approving ANZ Banking Group’s proposed equity participation in AMMB Holdings while rumours surfaced that DRB-HICOM has received BNM approval for talks to dispose its 20.2% stake in EON Capital to Newbridge Capital. Bursa Malaysia’s link up with the Singapore Exchange may be delayed to next year while MAS is selling its hotel and land in Langkawi to a Saudi group for RM435m. For today, despite selling pressure likely to be easing, the overnight fall in US markets may mean that the KLCI may at best be rangebound. The 1170 pts support level has to continue to hold for the market to stage a rebound in the short term. Resistance is at 1196 pts.

Daily Commentaries 1st Mar 07

2007-02-28T18:53:00.001-08:00

With the global fall in stock markets, the KLCI was no exception, down over 100 pts at its lowest before recovering to post a 40.6 pts drop. For today, we continue to advise caution on the market as the high volume yesterday, close to 4bn shares, would seem to indicate that selling pressure may not be completed exhausted. Nonetheless, we believe that selling by foreign institutions has resulted in some key blue chip companies becoming attractive bargains at current prices and investors should monitor these closely to determine the right entry price. For corporate news today, the Transport Minister said that Malaysia wants a more liberal aviation agreement with Singapore although the open skies policy does not appear up for discussion. Mobile Number Portability may be introduced by next year. On a broader arena, Malaysia’s GDP figures came in within expectations while Chinese Government officials denied plans to levy capital gains tax on stocks. With the US markets rebounding as the US Federal Reserve Chairman reassured investors that the economy will continue growing, it will be crucial to monitor the key support level of 1170-1190 pts to decide whether or not to bargain hunt.

Daily Commentaries 28th Feb 07

2007-02-27T19:06:00.001-08:00

The KLCI and regional bourses took a tumble yesterday on worries over US recession and the spillover effect of the introduction of a capital tax gains in China. Several results announced last evening were Maxis, Kulim, Nestle, Proton, PLUS and Maybulk. Headline corporate news includes Singapore’s statement that it would conduct "suitability checks" on two Genting group firms which won a bid to operate the city-state's second casino, warning that they would not automatically qualify for a casino licence. Meanwhile, UBG clarified that it was "not aware" that the EPF was planning to offer it about RM2.3bn for its stake in RHB. The market may be jittery today as the Dow fell more than 500 points on concerns of the slowing down of the US and China economies and that share prices have become overinflated. Immediate support now stands at 1,223 points with resistance at 1,250 points level.

Daily Commentaries 27th Feb 07

2007-02-26T18:26:00.000-08:00

The market took a breather yesterday as investors lock-in gains after the strong rally last week. In terms of key results announced last night, MAS was slightly below expectations while KNM, Dialog and Tong Herr were in-line. Notable business headlines today includes BNM keeping the OPR steady at 3.5%, Sime Darby to develop a 23.8ha land in Mont Kiara into a multi-billion Ringgit residential, office and commercial development, Tenaga planning to hive-off its Indonesia coal asset while Petronas buying gas from three offshore fields operated by Murphy. Given very little upside surprise on the results front coupled with crude oil prices holding above the US$61 per barrel weighing on the US markets, sentiment on the market may be capped. Immediate resistance is seen at 1283 with support at 1258.

Daily Commentaries 26th Feb 07

2007-02-25T18:40:00.001-08:00

The KLCI showed another good performance last Friday, breaching the 1,278 support to close 6.95 points higher. Major corporate news for today includes the extension of TM and TNB’s CEO contract for three years, UEM’s detailed plans for the development of Nusajaya and MAS’ ‘Project Firefly’, which plans to use Penang as the new domestic and regional operation to service the premium travel market. Nonetheless, the local bourse should be encouraged by Telekom’s heartening FY06 results while the disappointment in Star Cruises numbers may have a negative impact on Resorts World. The market would be warming up for the release of the 4Q06 GDP and CPI numbers this week. However, the slide in the Dow last Friday as well as the rebound in oil prices may dampen sentiment. The KLCI’s resistance now stands at 1,300 points with support at 1,278 points.

Daily Commentaries 23rd Feb 07

2007-02-22T23:43:00.000-08:00

As expected, the market retraced yesterday inline with declining US markets although volume reached another record high. For today, the Government has denied it has influenced the significant rise in the KLCI of late. Positive corporate news comes in the form of Bumiputera-Commerce’s 3.4% placement to Bank of Tokyo-Mitsubishi UFJ at a 17% premium to its previous closing price and IOI’s planned expansion of its plantation business with a war chest of RM2.2bn. Zelan announced another RM2bn power plant in Indonesia while Protasco announced it had been awarded a road maintenance contract in Libya for RM128.1m. Dialog is buying a UK technology provider while Guthrie is selling its MDF plant for RM145m. Finally, a Berjaya Land JV has secured rights to develop a US$350m property development project in Vietnam. With enough good news in the form of new contracts for today, the market may stage a rebound to attempt a close above the 1278 pts level although we think that significant gains maybe difficult given the overnight fall in US markets. Support is now at the 1265 pts level. Oil prices which closed at their highest since the start of 2007 may raise fears of inflation again.

Daily Commentaries 22nd Feb 07

2007-02-21T18:11:00.000-08:00

On the first trading day after the CNY holiday, the market rallied ahead with gainers outnumbering losers by more than 7 to 1 and volume breaking the 4bn shares mark. News for today is in the form of Linde’s takeover offer for the remainder 55% stake of MOX which it does not own at RM15 per share. Maybank’s results were below expectations although it did report a modest growth for 1HFY07. IJM has been awarded a contract for the development of airside infrastructure at the Senai airport for RM145m, PSCI announced 3 ship building contracts worth US$42m while Leader Universal has also won a contract, jointly with MKCSS Holdings, to develop a 200MW power plant in Sihanoukville, Cambodia. January vehicle sales also dropped from a year ago. Finally, MTouche is proposing a 4-for-1 bonus issue and a private placement exercise. The mixed bag of news coupled with the overnight fall in European and US markets on renewed fears of inflation may mean that further gains on the local bourse may be hard to come by. The 1278 pts support level will be crucial to determine if the market can sustain its current momentum in the short term although the longer term uptrend looks intact. Below 1278, the next support level would be at 1265 pts while the next resistance would be the 1300 pts resistance level.

Daily Commentaries 16th Feb 07

2007-02-15T18:38:00.000-08:00

The market did not disappoint in terms of a CNY rally, running up another 12.99 pts on a record 3.5bn shares being traded although market breadth was not too positive with gainers outnumbering losers by only a 5:4 ratio. Big news is Petronas’ announcement that it will begin work on its Kimanis oil & gas terminal in June 2007 while Protasco announced a RM45m LOI to build a teacher’s training college in Penang. Among the notable results announcement last evening were Transmile’s and BAT’s excellent set of numbers. Although profit taking is imminent, the strong market sentiment as well as the Dow’s record close last night and slipping oil prices may continue to boost the local market. The market is now looking at the 1,278 pts resistance level before the upcoming CNY holidays.

Daily Commentaries 15th Feb 07

2007-02-14T18:14:00.000-08:00

Ahead of the CNY festival next week, the market put in a broad based rally after a few days of correction with volume breaking the 2.8bn shares mark. Today’s corporate news focuses on Ranhill which is executing Phase 2 and 3 of its RM5.6bn Libyan housing construction project and SP Setia which is selling land worth RM107m in Pulai. RHB provided more details of its plans to sell RHBCap shares back to its shareholders while Green Packet and YTL-e are tipped to win 2 WiMAX licenses. In terms of results, Magnum 4D’s was a disappointment while Ann Joo’s and Digi’s strong growth show that the expected surge in corporate profits can indeed be achieved. The Government will decide soon on Malaysia Airport’s restructuring plan including its proposals to increase airport taxes. KNM announced a JV with a leading US technology firm to provide EPCC services for biodiesel plants in South East Asia and Oceania. With the US markets rallying overnight on the US Fed’s comments that inflation is controlled, we expect another good day today. Resistance is now positioned at the 1250 pts level followed by the 1278 level.

Daily Commentaries 14th Feb 07

2007-02-13T18:04:00.000-08:00

The KLCI rebounded in the second session to close 2.44 points higher yesterday. Topping corporate results last night were IOI Corp, IOI Plantation and Titan’s stellar results as well as AMMB and Star’s numbers, which came in within expectations. Meanwhile, KFH maintained that it is not increasing its offer for RHB. DRB-Hicom plans to assemble more models in its Pekan plant and Pos Malaysia is investing RM200m to set up a new National Mail Processing Centre by 1Q09. Big aluminium companies may be the next in line for consolidation as mining conglomerates scour the globe for targets. Speculation is building that a mining giant could bid to buy Alcoa or Alcan, triggering a surged on the Dow overnight. The local bourse may continue to be weak with selective bargain hunting ahead of the long weekend. Support remains at 1,218 while resistance is pegged at 1,240.

Daily Commentaries 13th Feb 07

2007-02-12T18:00:00.000-08:00

Lower liners and laggards continue to dominate trading interest with blue chips pulling back for the second day. Overall market breadth was negative with the number of losers outpacing gainers 2-to-1 as trading volume contracted to 1.5bn versus the 2.7bn record last Friday. In terms of results, Petronas Gas came in above, Amway was in line while Tek Seng disappointed. In the news today, Khazanah is in advance negotiations with UEM World to acquire some 2,000ha of land in Johor while MRCB has secured a RM282m contract to build transmission lines for TNB. MAS also said it is on track to post a second consecutive quarter of profit while Multi-Purpose revealed it is not aware of a 10% stake reported to have been acquired by tycoon, Quek Leng Chan. US markets closed weaker overnight as investors fret over disappointing deal news and uncertainty over Fed Chairmans’s speech to the Congress later during the week. We think the KLCI may drift further before attempting a recovery. Support now moves to 1218 while resistance is pegged at 1240.

Daily Commentaries 12th Feb 07

2007-02-11T19:59:00.000-08:00

Attention shifted to second liners and laggards as blue chips took an expected breather after the recent rally. Key headlines out of the weekend include AMCORP emerging as a substantial shareholder of ECM Libra, TNB confirming on-going discussions with Sime Darby on the undersea cable project, Sime Engineering's subsidiary clinching a contract to build a process platform, utility platform and three bridges offshore Qatar. Ramunia has received the letter of award for the RM307m EPCC contract at the Malaysia-Thailand Joint Development Area while Petra Perdana has placed-out a 10% stake in the company to HL Company Management for RM2.75/share. Genting is also mulling the possibility of selling- off non-gaming assets. Meanwhile, Ornasteel results came in ahead of our expectations although below consensus estimates. On the US front, observers expect the Dow to push higher this week on the back of positive economic data. Locally, the record underlying volume should see the broader market maintaining its positive vigour ahead of the Chinese New Year. Immediate support and resistance levels remain at 1240 and 1250 respectively.

Daily Commentaries 9th Feb 07

2007-02-08T19:31:00.000-08:00

The bulls came back in the afternoon trade to push the KLCI forward towards its 1250 pts resistance level on a day of record trading volume. In terms of results released yesterday, YTL Power reported decent growth while F&N was flat. Tan Sri Quek Leng Chan emerged as a substantial shareholder of Multi-Purpose Holdings after buying a nearly 10% stake from Magnum. The US-Malaysia FTA talks are continuing with contentious issues likely to be avoided. Puncak Niaga will be suspended from Feb 15th to facilitate its capital repayment while Malaysia Airports is considering setting up a LCCT in Penang. On the overseas front, US markets closed slightly down on concerns over its housing sector while Oil price closed back above US$60 per barrel as a fire shut down a major Californian oil field. Blue chips may take a bit of a breather today with attention shifting more towards lower liners and laggards in the market. Resistance remains at 1250 pts followed by the 1278 pts level while support is at 1236 pts.

Daily Commentaries 8th Feb 07

2007-02-07T18:29:00.000-08:00

Plantation and banking stocks helped the KLCI notch another close to 7 point gain yesterday with volume hitting a record 2.35bn shares mark. Positive sentiment appeared to be spreading with gainers outnumbering losers although the second board still lost ground. Big news today would be RHB Cap confirming that it has received an offer from EON Cap to acquire its entire business for the equivalent of RM4.80 per RHB Cap share while shareholder RHB has received a counter voluntary offer from EON Cap for all its shares at RM1.80 per share. Sanbumi provided further details of its business collaborations with airlines flying between Malaysia, Taiwan and Cambodia. Alam Maritim has received an RM18.1m LOI from Talisman to charter 1 of its anchor handling vessels while Coastal Contracts received MOAs worth RM243m for the sale of 7 offshore vessels over the next 2 years. AirAsia expects AirAsia X to start its services by September while its CEO’s private ventures, Tune Money and Tune Hotels are also expected to be launched soon. With all this positive newsflow, we feel that the market may continue its march ahead today towards the next resistance level of 1250 pts while support moves to 1226 pts.

Daily Commentaries 7th Feb 07

2007-02-06T19:24:00.000-08:00

KLCI continued its march upwards, closing 10.9 points higher on the back of heavy trading volume. Ringgit rose to the strongest in nine years after BNM clarified that it was not targeting any specific exchange rate levels. RHB continues to garner headline news. The Utama Banking Group is believed to have accepted a RM2.2bn offer from KFH to gain control of RHB. Other corporate news today are the award of RM113m worth of work for KNM and Kencana’s RM39m contract to build an offshore platform and structures. Meanwhile, DRB Hicom has clarified that it is not selling its stake in EON to EPF and AirAsia denied media speculation that it planned to raise money in a right issue. With the bullish performance over the past 3 days and the upcoming CNY holidays, profit taking is imminent. Nonetheless, the corporate results season this month is not likely to give any major signal to the KLCI. Resistance and support remains at 1,240 and 1,209 respectively.