Friday, March 12, 2010

20100312 1904 FCPO Weekly Chart Study.

FCPO closed : 2649, changed : -21 points, volume : slightly lower.
Bollinger band reading : side way upside biased.
MACD Histrogram : slightly lower, still a buyer market.
Support : 2580, 2530, 2500 level.
Resistant : 2730, 2800, 2850 level.
Comment :
FCPO eased lower this week after the 3 days palm oil conference with slighty lower volume changed hand ended the week with a 102 points range doji bar candle. Weekly chart outlook suggesting a uptrend biased with near term side way range bound market.

20100312 1839 FKLI Weekly Chart Study.

FKLI closed : 1316, changed : +13 points, volume : higher.
Bollinger band reading : bullish but over extended.
MACD Histrogram : recovering, buyer still in.
Support : 1310, 1300, 1270 level.
Resistant : 1350, 1370, 1390 level.
Comment :
FKLI ended higher with higher volume lower after hitting 2 years high and followed by profit taking pushed price to closed near the low. Weekly chart outlook still look bullish biased but the over extended upward movement could triggered a pullback effect and market is still potentially trade higher.

20100312 1822 FCPO EOD Daily Chart Study.

FCPO closed : 2649, changed : -11 points, volume : slightly lower.
Bollinger band reading : side way market.
MACD Histrogram : getting weaker, seller getting aggressive.
Support : 2620, 2590, 2570 level.
Resistant : 2650, 2670, 2700 level.
Comment :
Last minutes buying lifted price to closed almost at the high of the day recovered most of the earlier losses but still ended in negative territory with high volume transacted. Daily chart wise, today's candle tested below the middle Bollinger band but failed to stay below it suggest that there are significant support near these level and market is likely to trade side way range bound with a little upside biased in the near terms.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20100312 1757 FKLI EOD Daily Chart Study.

FKLI closed : 1316, changed : -5 points, volume : lower.
Bollinger band reading : bullish with correction.
MACD Histrogram : weaker, buyer taking profit.
Support : 1315, 1307, 1300 level.
Resistant : 1325, 1335, 1345 level.
Comment :
FKLI ended lower in profit taking mood ahead of the weekend with lower volume changed hand. Daily chart suggesting that market still trading in correction phase side way range bound but upside biased market.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20100312 1300 FKLI Mid Day Hourly Chart Study.

FKLI closed : 1317, changed : -4 points, volume : high.
Bollinger band reading : dowside biased.
MACD Histrogram : mostly lower, buyer taking profit and seller present.
Support : 1315, 1307, 1300 level.
Resistant : 1325, 1335, 1345 level.
Comment :
7 points premium FKLI traded lower in high volume due to profit taking activities through out the whole morning session. Hourly chart reading turned negative today and suggesting a possible further downside potential market with the last 3 candles traded side way range bound.

20100312 1250 FCPO Mid Day Hourly Chart Study.

FCPO closed : 2635, changed : -25 points, volume : low.
Bollinger band reading : side way downside biased.
MACD Histrogram : lower, seller taking chances.
Support : 2620, 2590, 2570 level.
Resistant : 2650, 2670, 2700 level.
Comment :
Low volume and support level broken FCPO opened and traded weaker in unison with weaker soy oil futures price during the morning session. Negative sentiment occupied the hourly chart reading that is suggesting a side way range bound downside biased market in the near term.

20100312 0933 Malaysia Corporate News.

Tan Chong Motor Holdings has won the sole and exclusive rights to sell Nissan vehicles in Cambodia under a distribution agreement entered into with Nissan Motor Co Ltd yesterday. It would start selling Nissan cars in Cambodia in the second quarter of this year with an initial sales volume of 200 units per year, Tan Chong Motor added. (Starbiz)

Berjaya Sports Toto would replace its Super Toto 6/49 with another lotto game, Supreme Toto 6/58. Supreme Toto would be launched on 18 March 2010, while its first draw would be held on 20 March 2010. (Financial daily)

As the tussle for control at EON Capital (EON Cap) simmers on, Affin Holdings, the parent company of Affin Bank, may be gearing itself to launch a takeover of EON Cap. Unfazed by criticisms of it being among the smallest banking groups in Malaysia, Affin Holdings is confident of its improving financials and the fact that it has not raised its tier-2 capital indicates that it may be timely to do so.“People usually think that a bank has to be big to be successful,’’ said a source. “Not every big bank has good ratios and look what happened to some of the world’s biggest banks. “Affin Bank has been quiet but producing the results,’’ another source said. “In the last few years, it has been improving to a point where it is quite comfortable with the numbers but some people have not gotten over their previous perceptions to appreciate the changes that have taken place. (Starbiz)

Gamuda and WCT, whose joint-venture firm in Qatar is being sued for RM101m by a local contractor, are not expecting significant losses arising from the arbitration case. “The financial impact of the claim can only be ascertained upon the conclusion of the arbitration proceedings,’’ the firms said. (Starbiz)

Telekom Malaysia and Manchester United have forged a 5-year agreement to link the two brands in marketing campaigns and promotional activities. With the deal, TM becomes MU's official integrated telecoms partner in Malaysia with licensing, intellectual property and dealership rights to produce and distribute merchandises bearing the club's crest and team images. (StarBiz)

Axiata is proposing to offer up to 20% equity interest in its 86.5%-owned XL Axiata via an international private placement of secondary shares. It is envisaged that the exercise will enable investors to participate in the growth of XL directly. The final offering price and size will be determined after the completion of the bookbuilding process. Dato’ Sri Jamaludin Ibrahim, President and CEO of Axiata said, “As the majority shareholder of XL, Axiata believes an increase in the free float is positive for XL’s long term corporate development as one of Indonesia’s flagship companies. ...Our shareholders and shareholders of XL can be reassured that XL shall remain as a subsidiary of Axiata Group after the offering, and we will remain fully committed as a strategic shareholder of XL.”Goldman Sachs has been appointed as Sole Global Coordinator and along with CIMB Investment Bank are acting as Joint Bookrunners. Goldman Sachs, CIMB Investment Bank,PT Mandiri Sekuritas are Joint Lead Managers of the Offering. The offering is expected to be completed by April of 2010. (Axiata)

Fitch Ratings affirmed XL Axiata's National Long-term Rating at 'AA-(idn)' with a Stable outlook. It also affirmed XL's IDR1.5tr senior unsecured notes at 'AA-(idn)'. The agency also rates XL's foreign and local currency Issuer Default Ratings at 'BB' with a Stable Outlook. XL's ratings reflect its entrenched third position in Indonesia's cellular market, reasonable growth prospects, and strategic importance to its Malaysian parent, Axiata. Fitch has incorporated a one-notch uplift from XL's standalone rating to reflect the company's strategic importance to its parent. (Fitch)

SP Setia has in principle bagged a property project from Vietnam's Investment and Industrial Development Corp to develop a 10.8ha land in Binh Duong province, Vietnam, for a 50-year term. SP Setia said it has received an investment certificate from the People's Committee of the Bunh Duong Province for the establishment of Setia Lai Thieu One Memer Co Ltd with a charter capital of US$6.5m. (BT)

Qatar-based Gulf Petroleum is leading a consortium of Gulf banks and energy firms to build a RM17bn integrated oil & gas complex on 1,000-1,500 acres of land in Port Dickson next year. On Wednesday, the company signed agreements with parties that include South Korea's GS Engineering & Construction, Saudi Arabia's Haykalah, the UAE's Geodynamics International Co and Singapore's Gas & Oil Support Services Pte Ltd. The agreements cover the financial, construction, operation and maintenance, equity-holding, off-take arrangement for end-products, and technical aspects of the project. (BT)

Singapore Technologies Telemedia and U Mobile will sign a “strategic partnership” agreement on March 15, according to a media invitation, which didn’t give details. (Bloomberg)

India is set to miss the Mar 31 deadline for implementing mobile number portability (MNP), junior minister for communications and IT Gurudas Kamat told Parliament on Thursday. This will mark the third instance of the country missing out the deadline to offer its 550m cellular users this facility. The earlier date for introducing MNP was Dec 2009 in the metros and the category A circles. But, with the department of telecom (DoT) being unable to meet this deadline, it had then announced that this facility would be rolled out simultaneously across the whole country from Apr 2010. (Economic Times of India)

Adventa announced that it is acquiring the remaining 40% stake of its 60% owned subsidiary Utama Associates Sdn Bhd. The company stated that it had on 11 March 2010 entered into a Share Sale Agreement to acquire 248,000 ordinary shares of RM1.00 each in Utama Associates, representing 40% shares of the total issued and paid-up capital of Utama Associates at a purchase consideration of RM459,847 to be satisfied wholly by cash. Upon the completion of the acquisition, Utama Associates will become a 100% wholly-owned subsidiary of Adventa. (BMSB)

Khazanah Nasional Bhd is placing out 7.7% of Malaysia Airports Holdings Bhd, following a similar exercise in September last year when it sold a 5% stake in the airport operator as part of its programme to reduce its holdings in government-linked firms. The new placement of 85m shares, via a book building process, is aimed at raising as much as RM400m. Prior to the current placement, Khazanah had a 67.7% stake in MAHB. CIMB and JPMorgan are joint bookrunners in the placement exercise, the term sheet showed. (Reuters)

RAM Ratings says YTL Power International's move to roll out its RM2.5bn WiMAX network is quite unexpected and this was not in line with its track record of investing in long-term concession assets with stable and sustainable cashflow. "Although RAM Ratings is less sanguine about the group venturing into a non-concession-based business, we note that YTLPI’s power and water concession assets will remain its major cashflow contributors.” The ratings agency said while the group will be viewed to have a more aggressive risk appetite if it deviates further from its strategy of only investing in concession-based utility and infrastructure assets, "we note that the management has been circumspect in its investment decisions and has demonstrated good acumen in business execution thus far". RAM Ratings, meanwhile, reaffirmed the AA1 ratings of YTLPI’s RM2bn 2007/2014 (CP/MTN) and RM2.2bn billion serial redeemable bonds (2008/2013); long-term ratings have a stable outlook. (BT)

YTL Corp is planning an issue of up to US$400m worth of five-year bonds that can be exchanged into ordinary YTL shares, according to a term sheet seen by Reuters. The exchangeable bonds, which mature in 2015, will pay a coupon of 1.375-1.875%. YTL plans to issue US$350m worth of the bonds with an option to increase the issue by another US$50m. The bonds' strike price will be 20-25% above the share's closing price of RM7.48, the term sheet said. (Reuters)

China's Dalian Commodity Exchange (DCE), which currently settles an average of 300,000 refined, bleached and deodorised (RBD) palm oil contracts a day, plans to lower transaction fees by 25% to woo more trades. "We're looking at reducing settlement fees from 4 to 3 yuan per contract to make it more attractive for traders. That's a 25%," said DCE senior manager Wang Yun Tao. "We'll be conducting hedging seminars to some 1,000 enterprises that buy RBD palm oil for their factory use. Through this we hope to attract more traders and more volume at our exchange," he added. (BT)

The Palm and Lauric Oils Conference & Exhibition Price Outlook (POC 2010) was a lot more crowded than last year and there were more Americans. The higher turnout was in anticipation of CME Group announcing the launch of its new US dollar-denominated cashsettled CPO futures contract, called CUPO, on CME Globex electronic trading platform. Traders in Chicago get to trade CUPO from May 23 this year but those in Kuala Lumpur will get access to it on May 24 due to the 12-hour difference. (BT)

The International Air Transport Association (IATA) expects Asia-Pacific carriers to turn in a combined US$900m profit this year - versus their US$2.7bn loss in 2009 - on the back of a rapid economic recovery driven by China.
  • Overall, the industry loss forecast for this year is lowered to US$2.8bn - from the US$5.6bn IATA predicted in December last year. Revenue is tipped to rise to US$522bn, which is US$44bn more than forecast previously and a US$43bn improvement from 2009. It also cut its 2009 industry loss estimate to US$9.4bn - from US$11bn. 
  • Key factors that led to the lower loss forecast include an expectation that passenger demand will grow 5.6% this year, versus a 2.9% fall in 2009. This is an improvement on IATA's December 2009 forecast of 4.5% growth this year.
  • By January, the international passenger load factor was 75.9% and cargo utilisation was 49.6%. Tighter supply and demand conditions are expected to lift yields by 2% for passengers and 3.1% for cargo in 2010, a big improvement from a 14% fall for both in 2009.
  • Cargo markets are particularly strong, with long-haul cargo capacity for shipments from Asia suffering a shortage. Cargo demand, which fell 11.1% in 2009, is now expected to grow 12% in 2010. This is also significantly better than the previous 7% forecast. (SBT)
MISC’s unit MISC Agencies Sdn Bhd has signed a joint-venture deal with two India-based companies, Crescent Shipping Agency (India) Ltd and Sivaswamy Holdings Pvt Ltd. Called MISC Agencies India Pte Ltd, the joint-venture company will act as the sole and exclusive shipping agent for MISC in India. MISC Agencies will have a 60% stake in the joint-venture company, while Sivaswamy and Cresent will own 25% and a 15% respectively. The authorised capital of MISC Agencies India will be 50m rupees (RM3.82m) and the issued and paid-up capital 40m rupees (RM3.06m). (BT)

A planned jumbo-scale commercial development on the current Majidi army camp site could make shopping in Johor Baru city a vastly different experience when the RM12bn project is completed over the next decade. The blue-print of South Key - the fullyintegrated commercial development - which envisages street malls, offices, hotels and shop-lots, is to be built on 300 acres (121.4 ha, about the size of 270 football fields) in the city, said CH Williams Talhar & Wong director Danny Yeo Soon Kee. (SBT)

TA Enterprise (TAE) has proposed to dispose of a 100%-owned four-star hotel in Singapore to its property arm TA Global for shares in a deal worth RM651.78m. Under the deal, TA Gobal will assume RM398.6m worth of loans obtained by TAE as part of the purchase consideration. The final purchase amount of RM253.18m will be settled via the issuance of 506.36 m new shares in TA Global at 50 sen each to TAE. “The proposed disposal would enable TAE to streamline its two main core businesses – financial services and property and hospitality division,” it said. (Starbiz)

Datuk Low Tuck Choy’s second bid to regain control of the Ho Hup Construction Co board was dealt a major blow after an ex parte injunction order barred him, his sister and their company Low Chee & Sons Sdn Bhd (LCS) from voting at an upcoming EGM. (Starbiz)

20100312 0915 Malaysian Economic News.

Current account surplus rose by RM2.0bn (7.9%) to RM27.3bn in 4Q09 (RM25.3bn in 3Q09). It was equivalent to 14.8% of gross domestic product. The increase was mainly due to higher surplus on goods by RM4.5bn to RM38.0bn (RM33.4bn in 3Q09) and lower leakage on current transfers by RM2.0bn to RM4.7bn (RM6.7bn in 3Q09). For the year 2009, the current account balance was RM112.7bn, a decrease of RM16.8bn (13.0%) from RM129.5bn recorded in 2008. (BT) Please see our Economic Update for further details

Industrial production rose 12.7% yoy in January (7.5% in Dec 09), marking the fastest growth pace since Mar 04 and beating market expectations for a 11..7% rise. On a mom basis, industrial output increased by 2.9% (3.3% in Dec 09). (BT) Please see our Economic Update for further details

The first stage of the New Economic Model (NEM) will be announced on 30 Mar 10, Prime Minister Datuk Seri Najib Tun Razak said. The second stage of the model would be announced at the tabling of the 10th Malaysia Plan. “We want to engage all stakeholders,” he said. (Bernama, BT, The Star)

The Prime Minister said the Cabinet had given the green light to the International Trade and Industry Ministry (Mitt) to study the possibility of Malaysia entering the US-initiated Trans-Pacific Partnership (TPP), adding that the ministry had embarked on a deep and comprehensive study on the matter. “The Cabinet will make its decision if the study by Miti shows that TPP benefits Malaysia,” he said. (The Star)

The Cabinet only discussed aspects of the Goods and Services Tax (GST) on 10 Mar, especially the people's understanding of the proposed tax system and its implementation, Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah said. "We did not say cancel. We discussed in details the implementation of it in terms of people's familiarity and on how ready we are. We do not want to face teething problems later, which may cause difficulties to the people. No final decisions have been made,” he said. (BT)

Deputy Prime Minister Tan Sri Muhyiddin Yassin called on the private sector to penetrate new markets in view of the national economy still not having picked up fully. "The government has taken various initiatives to stimulate the economy. In ensuring international trade continues to play an important role in economic growth, the government is making efforts to expand free trade agreements (FTAs) with major markets and others which hold good potential," he said. He urged companies to seize opportunities resulting from Asean's FTAs with India (AIFTA) and with Australia and New Zealand (AANZFTA) to ensure Malaysia's continued competitiveness at the world level. (Bernama)

The government is targeting to eradicate hardcore poverty and poverty among the 11,233 hardcore poor households in Sarawak by year-end, currently registered under the e- Kasih database. Women, Family and Community Development Minister Datuk Seri Shahrizat Abdul Jalil said, such an initiative would be implemented under the ministry's 1Azam programme to create income-generating opportunities. (Bernama)

Malaysian Rating Corporation Bhd (MARC) has revised Gross Domestic Product (GDP) growth upwards to 5.2% for this year from 3.6% estimated earlier. The overall economic prospects for this year was more favourable following positive economic data released recently. "The continued acceleration in the growth of the overall industrial production and manufacturing index suggest that the upward momentum of Malaysia's industrial activity remained intact. It will likely lead to a higher-than-expected expansion in the manufacturing sector," MARC said. (Bernama)

Total manufacturing sales rose 28.8% yoy to RM43.3bn in January (15.9% in Dec 09). On a mom basis, the sales value also increased marginally by 0.3% in January (5.1% in Dec 09).
  • Total employment in the manufacturing sector fell by 3.8% yoy to 37,082 persons in January (4.9% in Dec 09). On a mom basis, it climbed 0.7% or 6,286 persons to 949,872 in January (0.3% in Dec 09). 
  • Total salaries and wages paid in January increased 12.5% yoy to RM2.1bn (-0.9% in Dec 09). (Department of Statistics)

20100312 0912 Global Economic News.

The US trade deficit unexpectedly narrowed in January as imports fell for the first time in five months. The gap shrank 6.6% to –US$37.3bn (-US$39.9bn in Dec 09) as refineries imported the fewest barrels of crude oil in a decade. Exports decreased for the first time in nine months, on fewer shipments of aircraft and autos. (Bloomberg)

US initial jobless claims fell 6,000 to 462,000 in 6 Mar week after seasonal adjustment. The level was just slightly above the 460,000 level expected by the market. The number of people filing continuing claims jumped 37,000 to 4,558,000 in the week ended 27 Feb. Economists were expecting continuing claims to remain unchanged at 4,500,000. (CNN Money, Xinhua)

The net worth of American households increased slightly during the final three months of 2009, the Federal Reserve said.
  • Household net worth, the difference between assets and liabilities, rose to US$54.2tr in 4Q09, up from US$53.5tr in 3Q09. It was the third consecutive quarterly increase, but the figure remains well below the highs of just two years ago. In the second quarter of 2007, net worth peaked at US$65.3tr. 
  • For 2009 as a whole, household net rose US$2.8tr, compared with a decline of US$11.2tr in all of 2008. The rebound in household net worth came as the value of Americans' investment portfolios continued to increase. Stock holdings jumped nearly 4.0% to US$7.7tr. However, real estate values rose less than 1.0%. (CNN Money)
European Central Bank (ECB) council member Yves Mersch said the economic recovery in the 16 nations that share the euro will probably be uneven. “Available data suggest the economic recovery process in the Eurozone has started, though the upswing will most likely remain erratic. Risks to this outlook are balanced in a climate that continues to be marked by uncertainty,” Mersch said. (Bloomberg)

Japan’s economy expanded 3.8% yoy in 4Q09, which was less than initially estimated 4.6% as companies pared spending and stockpiles as deflation deepened. On a qoq basis, economy grew 0.9% in 4Q09, slower than the 1.1% first reported. The GDP deflator, a gauge of price trends, fell a record 2.8%. (Bloomberg)

Japan’s central bank may seek, next week, to counter a contraction of its balance sheet caused by the month-end expiration of an emergency-credit program as deflation persists. The Bank of Japan’s options include expanding a ¥10.0tr (US$111.0bn) fund providing loans to banks. (Bloomberg)

Bank of Korea (BOK) Governor Lee Seong Tae kept interest rates unchanged at his final meeting, leaving it to his successor to address political pressure to stoke economic growth. The seven-day repurchase rate kept at a record-low 2.0%, as expected by economists. (Bloomberg)

China’s consumer price reached a 16-month high of 2.7% yoy in February (1.5% in Jan). Industrial production climbed 12.8% yoy in February and accumulated 20.7% in Jan-Feb this year, marking the highest increase in more than five years. Retail sales registered a 22.1% yoy growth in February, beating the market consensus for a 18.1% yoy gain and fueled by Lunar New Year consumption and the nation's stimulus measures. (Bloomberg, Xinhua)

The Singapore Tourism Board (STB) forecasts tourism figures this year to increase from 9.7m visitors in 2009 to 11.5-12.5m visitors and S$17.5-18.5bn in tourism receipts. Ken Low, assistant chief executive of STB’s marketing group said that the increase was on the back of recovering global economy, major events and the launch of integrated resorts (IRs). “They (IRs) are our trump cards. We anticipate they will contribute about S$2.8bn or 2.8% of GDP by 2015,” he said. (Financial Daily)

Thailand’s consumer confidence fell to 70.9 in February (71.9 in Jan). This was the first drop in four months on concern political tensions may derail the nation’s economic recovery. (Bloomberg)

Indonesia’s central bank raised its estimate for economic growth this year to as much as 6.0% from an earlier forecast of 5.6%, Deputy Governor Hartadi A. Sarwono said. Expansion in 2011 may be 6.0-6.5%. The outlook is supported by domestic demand and the global economic recovery. The growth forecast for the first quarter was raised to 5.7% from 4.8%. Inflation rate may average between 4.0-6.0% this year compared with an average of 2.8% in 2009. (Bloomberg)

The Philippine central bank pared back a lending program for banks and said it will consider doing more to reduce cash in the economy, even as it kept interest rates at a record low at 4.0% for a sixth straight meeting. Bangko Sentral ng Pilipinas reduced the budget for the so-called rediscounting facility to PHP40.0bn (US$875.0m) from PHP60.0bn, effective 15 Mar 10. Deputy Governor Diwa Guinigundo said that they will consider in the future unwinding the remaining liquidity measures. (Bloomberg)