Wednesday, April 28, 2010

20100428 1806 FCPO EOD Daily Chart Study

FCPO closed : 2547, changed : -3 points, volume : lower.
Bollinger band reading : side way range bound little upside biased.
MACD Histrogram : getting higher, buyer still in.
Support : 2521, 2500, 2470 level.
Resistant : 2550, 2570, 2600 level.
Comment :
After an exciting wild swing ultra high volume day, the excitement seems turned into a peaceful quiet day today that ended marginally lower tight range market. Daily chart reading continue to show a side way range bound market with still a little biased to the upside.
When to buy : buy at support/weakness/break up with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20100428 1723 FKLI EOD Daily Chart Study.

FKLI closed : 1328, changed : -10.5 points, volume : higher.
Bollinger band reading : downside biased.
MACD Histrogram : recovering, seller reduce exposure.
Support : 1325, 1318, 1310 level.
Resistant : 1330, 1337, 1345 level.
Comment :
A long upper and lower shadow doji bar candle with Ultra high volume FKLI ended the day lower at the opening price. Daily chart seems having a yet to be confirm triangle break down as price closed just fraction below the triangle. Expect market to trade downside biased with some room for further down testing support level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant/strength/break down with larger cut loss and profit target.

20100428 1323 FKLI Mid Day Hourly Chart Study.

FKLI closed : 1331.50, changed : -7 points, volume : high.
Bollinger band reading : downside biased with temporart pullback correction.
MACD Histrogram : recovering, seller lock in partial profit.
Support : 1330, 1325, 1318 level.
Resistant : 1337, 1345, 1350 level.
Comment :
Euro zone economic casualty fear spilled over across the entires major world market including the Dow resulted Bursa Malaysia FKLI to opened and traded lower in heating up ultra high volume. Hourly chart wise, market are currently having pullback correction within a further downside biased market as market once dived too drastically down 17.5 points within the 2nd hour of trading.

20100428 1321 FCPO Mid Day Hourly Chart Study.

FCPO closed : 2543, changed : -7 points, volume : low.
Bollinger band reading : side way range bound little upside biased.
MACD Histrogram : getting lower, buyer reduce exposure.
Support : 2521, 2500, 2470 level.
Resistant : 2550, 2570, 2600 level.
Comment :
Quiet volume no follow through after yesterday price surged FCPO traded lower following a weaker soy oil futures price development. Hourly chart shows that demand was not strong enough to sustain the upward movement as price is likely to trade side way rang bound with still some upside biased.

20100428 1252 Malaysia Corporate News.

A mobile gamble may be the next thing that Telekom Malaysia will have to consider getting itself into if it wants to enhance its existing triple play offering. But it will have to wait till early next year as it had in 2008 signed an agreement with Axiata that forbids it to get involved in the cellular business.
  • TM CEO Datuk Zamzamzairani said "it is too early to talk about it" but added that "we are open to opportunities." "We are excited about Unifi and we will exploit it when the time comes. We have options to consider wireless (or cellular) technology to enhance what we have. 
  • To enhance Unifi we could use some other (player's) network, have a technology partner or even built it ourelves (to bundle the services)."The company is sitting on the 450 and 800MHz spectrum, but whether these could be used for 4G offerings is unclear should TM decide to build its own network." (StarBiz) 
If TM were to build its own mobile network, we would view it negatively as this would: 1) make it the 5th player in a very saturated market, and 2) drain the telco's cashflow. Such a scenario is possible if TM acquires LTE spectrum. The regulator is looking to auction off 3 blocks of LTE spectrum next year.

has announced the acquisition of the remaining 60% share in Autic Mekki, a nickel plating company, it does not own for a total purchase consideration of RM3.4m. Following the acquisition, Autic Mekki will become a wholly-owned subsidiary and the entire acquisition is expected to close within three months.
This is not a surprise as we had mentioned this acquisition in our recent visit note. We take a positive view of the move as it would help to retain the value of the nickel plating process within Notion and enable it to realise cost savings on plating cost.

Indonesian coal miner PT Bayan Resources has declared force majeure on shipments from its Gunung Bayan coal mine in Kalimantan because of heavy rains and flooding. "Shipments for May to Malaysian and Italian buyers will be delayed because of the floods," Jenny Quantero, Bayan's spokeswoman said. Buyers affected include Tenaga Nasional and Italian firm Enel Trade SpA, she said. (Reuters)
This news is a negative surprise. At this point, it remains unclear how long the shipment could be delayed. We note that Tenaga is increasingly reliant on coal-generated electricity units to meet its strong demand patterns of late.

Las Vegas Sands (LVS) chairman and CEO Sheldon Adelson has set Marina Bay Sands (MBS) the goal of seeing a return on its US$5.5bn investment in five years. Earlier estimates by LVS had been more conservative. Mr Adelson expects MBS to do very well and he also said the IR will become the 'standard for economy changing tourism projects'. MBS president and CEO Thomas Arasi said he expects the IR to attract 70,000 visitors when fully completed, more than double the figure expected at Genting Singapore’s Resorts World Sentosa (RWS). (SBT)

Officials from the World Bank and the International Finance Corp (IFC) will be in Kuala Lumpur next month to discuss the establishment of an Islamic financing facility for the green technology sector, Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah said. The officials will be in KL from May 10 for discussions with Bank Negara Malaysia and the Ministry of Energy, Green Technology and Water to develop a suitable model in the creation of a syariah-compliant US$200m (RM636m) fund. (BT, Bernama)

Bursa Malaysia expects to attract a few large banks from the Gulf Cooperation Council (GCC) to be members of its syariah-compliant electronic commodity trading platform, Bursa Suq Al-Sila', by this year. When larger banks in the GCC countries come on board, trading volume through the platform is expected to increase substantially, Bursa CEO Datuk Yusli Mohamed Yusoff.
  • Bursa Suq Al-Sila' offers a platform for Islamic banks to buy and sell commodities to manage their short-term liquidity, as they cannot go to the conventional money market. 
  • Yusli said since Bursa Suq Al-Sila' was launched in August last year, progress has been good where about 90% of Malaysian Islamic banks are using the platform. There are also some cross-border trades being done by international Islamic banks through the platform.
  • He said Bursa has a dedicated marketing team that promotes the platform in the GCC region. "Their work involves convincing syariah committee of the respective banks in GCC on the value of Suq Al-Sila'," he said, adding that the team is making good progress.
  • Yusli also said that Bursa will expand the range of commodities traded on Bursa Suq Al Sila' within a few months to a year. He said the in-house team is still working on sourcing the supply of the commodity. "We are looking at various types of commodities. They may not necessarily originate from Malaysia, as long as their physical presence can be verified as the underlying asset," he said. It was reported that Bursa was looking at expanding the commodity traded on the platform to include non-precious metals. (BT)
Total deposits of full-pledged Islamic banks and Islamic windows of conventional banks operating in Labuan International Business and Financial Centre (IBFC) rose 14.5% to US$386.4m as at 31 Dec 09 from US$337.3m in 2008. There were six full-pledged Islamic banks and six Islamic windows of conventional banks operating during the period in Labuan IBFC, Labuan Financial Services Authority (Labuan FSA) said in its 2009 Annual Report released here today.
  • It said the year 2009 also recorded a significant increase in the non-resident deposits, where the bulk of the deposits were placed in institutions operating Islamic windows. The placements by non-residents as at last year stood at US$135.1m, an increase of 87.9% from US$71.9m in 2008. 
  • Meanwhile, total Islamic financing fell slightly to US$226.4m from US$231.4m mainly due to the reduction of financing to residents. Total Islamic assets also posted a slight decline last year, standing lower at US$794.7m from US$957.3m in 2008.
  • Labuan FSA said the Islamic capital market in Labuan IBFC grew modestly during the year reviewed after a landmark issuance of US$1.5bn sukuk out of Labuan IBFC. The sukuk, which was oversubscribed by 19 times and listed on the Labuan International Financial Exchange (LFX) highlighted that the Labuan IBFC remained a major centre for sukuk issuance.
  • The retakaful industry in Labuan IBFC also registered its third consecutive year of growth, exceeding 40% by the end of 2009, with the total takaful and retakaful contributions posting an increase of 44.2% in gross distributions amounting to US$234.1m. As at last year, there were five full-pledged retakaful companies, nine retakaful windows and 10 retakaful brokers in Labuan IBFC.
  • The total Islamic private funds in Labuan IBFC stood at US$3.2bn with market share of 33.4%. During 2009, one trust company had been deregistered due to merger with another Labuan trust company, bringing the total number of registered trust companies to 22. These companies posted an aggregate operating income of US$13m, down by 11.2% from US$14.6m in the previous year. (Bernama)
Media Prima is requesting NSTP to undertake the proposed withdrawal of listing status as NSTP’s current public shareholding spread is below the 25% threshold. Media Prima currently controls 89.6% of NSTP (194.7m shares) following the share swap exercise announced in Nov-09 which aimed to take NSTP private.
  • Media Prima is extending its voluntary general offer (VGO) to the remaining 10.4% stake in NSTP (22.6m shares) at RM2.40/share. This will be satisfied by six new Media Prima shares at RM2.00/share and one free Media Prima warrant for every five NSTP shares accepted. 
  • The share swap ratio of 1:1.2 is unchanged from the original offer. According to the proposal, this translates to an effective VGO price of RM2.83/share for NSTP, after taking into account the value of Media Prima warrants per offer shares. The proposed delisting and exit offer is expected to be completed by 3Q10. (Financial Daily, BMSB)
Johor will stop the sale of raw water to Singapore from the Skudai water treatment plant here upon the expiry of the related agreement next year, MB Datuk Abdul Ghani Othman said. "Negotiations are underway to return (the Skudai plant to the state government)," he said.
  • The Skudai plant is managed by PUB, Singapore's national water agency. Singapore's Environment and Water Resources Minister Dr Yaacob Ibrahim was quoted by the republic's media as saying that the city-state would not renew the agreement when it expired next year, saying Singapore has enough water supply. Another water supply agreement between Johor and Singapore will only expire in 2061. (Star)
The Southern Integrated Transportation Terminal in Bandar Tasik Selatan could be ready by July, Transport Minister Datuk Seri Ong Tee Keat said. The terminal will cater to all types of transportation.
  • We will have the bus services, taxi and rail services including the light rail transit, Keretapi Tanah Melayu’s commuter train service and Express Rail Link under one roof. The RM570m terminal is located on 19.8ha site adjacent to the Tasik Selatan’s LRT station and the Tasik Selatan KTM Komuter station. It has the capacity of handling about 40,000 passengers a day. (Star)
A new RM400m project has been proposed to the EPU to upgrade the existing Kota Baru- Kuala Krai road to ease heavy traffic flow between the towns. State Federal Development Department director Makhtar Mustapha said the department was waiting for the green light from the EPU to implement the project under the 10MP.
  • “This project is important because the road is a gateway for the north-bound traffic from Kuala Lumpur. Upgrading the 70km road will ensure smooth traffic flow during peak seasons.’’ he said. 
  • He said there was also a suggestion that Kota Baru and Kuala Krai be linked by a new highway, and the option was being looked into. Other major 10MP proposals include 16 new primary and secondary schools in the state. (Star)
Bank Negara Malaysia (BNM) wants to assess the feedback on the reform of third-party motor insurance before coming up with a proposal, says governor Tan Sri Dr Zeti Akhtar Aziz. "The matter will go through a consultative process.
  • We'll take note of the feedback we have received and do an assessment and a proposal," she said. Zeti said the scheme and the tariffs have been in place since 1978 and needed to be revised. 
  • BNM said last week that the revamp will be finalised by the third quarter of this year. So far, the Malaysian Bar Council has protested the proposed RM2m liability cap and the setting up of a new company to manage the scheme, under the central bank's proposed reform. It has urged Bank Negara to establish a cross-industry working committee to review the public feedback and propose a holistic solution. (BT)
Transmile Group has filed its first civil suit against its former chief executive officer, Gan Boon Aun and chief financial officer, Lo Chok Ping, after spending three years clearing up the mess left behind from an accounting scandal.
  • The former industry darling is seeking compensatory damages to be determined by the High Court, special damages of RM10.6m, costs on a full indemnity basis and interest on special and/or general damages as may be awarded by the High Court. 
  • Transmile and Transmile Management Sdn Bhd are suing Gan and Lo for grossly overstating the group's revenue by RM622m from 2004-06 and causing questionable payments and receipts in relation to the affairs of two wholly-owned subsidiaries - Transmile Air Services Sdn Bhd and Grouptech Sdn Bhd. (BT)
AirAsia’s subsidiary AirAsia Corporate Services Ltd has received the nod to carry on a Labuan captive insurance business in, from or through tax haven Labuan. It said the primary purpose of establishing the captive insurance business was to provide access for the company to commercial insurance markets and provide flexibility in managing and retaining its own risks.
  • It will also enable to directly insure AirAsia’s international aviation, maritime and liability risks. AirAsia will also be able to pay its insurance premium to the Labuan Captive Insurance business instead of paying through local insurers, bringing down insurance costs for the airline. (BT)
Malaysia's two main brewers say they will raise the prices of their beer and stout products by about 3% next month to offset higher costs. "The increase is industry-wide and across all categories (of products). It's primarily to catch up with rising raw material prices and input costs in the last three to five years," Carlsberg Brewery Malaysia's MD Soren Ravn said.
  • He said raw material prices have escalated by an average of about 10% per year over the last five years, making current product prices unsustainable. While a rising ringgit of late has helped cushion the blow somewhat, a moderate product price increase is still deemed necessary to secure the company's profitability going forward, he added. (BT)
Minority shareholders of MBf Holdings have rejected plans by its major shareholder to take the company private for 65 sen apiece. MBf will remain listed on the Main Market of Bursa Malaysia Securities as all resolutions were rejected. As a result, MBf's major shareholder, Tan Sri Dr Ninian Mogan Lourdenadin, shot down minority shareholders' request for a proposed final dividend of 10 sen per share for the FY12/09. (BT)

There were two listings on the Labuan International Financial Exchange (LFX) last year by Petronas Nasional. In August 2009, Petronas via its Labuan incorporated special purpose vehicle (SPV), listed a five-year US$1.5bn sukuk and a ten-year US$3bn conventional bond on LFX. The market capitalisation of the LFX as at 31 Dec 09, stood at US$18.1bn with a total of 28 listed instruments. (Bernama)

20100428 1238 Malaysian Economic News.

The stronger ringgit reflects the improvement in the country's economic conditions and should not be a cause for concern. Bank Negara Malaysia Governor Tan Sri Dr Zeti Akhtar Aziz said the ringgit had weakened substantially in 2009 but started to strengthen in 4Q09 and in 1Q10.
  • "We are seeing levels witnessed before. It had previously strengthened to a stronger level than what we are seeing today. Therefore, we are not concerned. We would be concerned, however, if there was excessive movement within a short period of time with disorderly market conditions or if there is a misalignment to the economic conditions," Zeti said. 
  • "We will make an assessment then on further normalisation of the interest rate at the next monetary policy meeting that will be held on 12-13 May," Zeti added. (Bernama, Malaysian Reserve)
The Ministry of International Trade and Industry (MITI) is very concerned with the labour shortage problem affecting the local automotive industry. It said that if the situation of labour shortage prolonged, the component parts industry would be affected with both locals and foreigners losing their job.
  • The shortage of staff in the northern region has reached critical levels as Malaysia could lose out on reinvestment of RM600m from multinational corporations (MNCs). 
  • MNCs face problems keeping the local workers with turnover rate at a whopping 25%. (Bernama, NST)
The Cabinet to date has not discussed any price increase of controlled items like petrol and sugar, said the Minister of Domestic Trade, Cooperatives and Consumerism Datuk Seri Ismail Sabri Yaakob. As such, he called upon people to not be influenced by rumours that there will be price hikes. (Bernama)

The number of taxpayers using electronic filing (e-filing) has exceeded the 1m mark, with the Inland Revenue Board (IRB) recording 1,011,703 users as of 26 Apr (+29.2% vs. 2009’s 783,173 users). (Bernama)

Deputy Finance Minister Datuk Dr Awang Adek Hussin said the property market this year will definitely perform better than in 2009 due to an improvement in the general economy. He added that Bank Negara may normalise the interest rate, but it will not to the extent of impacting adversely the property market. (BT)

As the world economy recovers with Asia leading the growth, the Labuan International Business and Financial Centre (Labuan IBFC) is strategically positioned to seize the opportunities presented by the expected revival in business sentiments and the higher risk appetite of investors. Tan Sri Dr Zeti Akhtar Aziz said the Labuan IBFC's central location in Asia made it the ideal regional platform for international investments. (Bernama)

Pos Malaysia Berhad and the Royal Malaysian Customs (KDRM) on 27 Apr inked an agreement to abolish the RM1 release charge imposed on each overseas parcel, effective 1 May. Pos Malaysia Chief Executive Officer Datuk Syed Faisal Albar said it was agreed that KDRM would absorb the cost for the release charge. Pos Malaysia will also shorten the Customs release transaction period to just 1 day, from the current 3 working days. (Bernama)

20100428 1232 Global Economic News.

US Conference Board consumer confidence index soared to a 18-month high of 57.9 in April (vs. 52.3 in March), above market expectations of 53.5. The Present situation index rose to 28.6 vs 25.2, Expectations rose to 77.4 vs. 70.4. Most regions improved, except for the South. Buying plans rose for autos and appliances. Concerns about business and job market conditions continued to ease, said Conference Board director Lynn Franco. She added that "continued job growth" will really be the key to keeping the momentum going. (Xinhua, CNN Money)

US home prices inched up 0.6% yoy in February according to the S&P/Case-Shiller 20- city index, with nine of the 20 cities showing gains. "The homebuyer tax credit, available until the end of April, is the likely cause for these encouraging numbers," said David Blitzer, chairman of the index committee at S&P. But home prices actually fell by 0.9% mom. The dip was small enough to put prices in positive territory compared with 12 months earlier, when home prices were falling very steeply. (CNN Money)

US congress must craft a credible plan soon to bring spending in line with revenue to close the unsustainable fiscal gap threatening the economy, key policymakers urged. "The path forward contains many difficult tradeoffs and choices, but postponing those choices and failing to put the nation's finances on a sustainable long-run trajectory would ultimately do great damage to our economy," Federal Reserve Chairman Ben Bernanke told a bipartisan panel charged with proposing ways to curb deficits. (CNN Money)

Hong Kong’s exports grew in Mar 10 at the fastest pace since 1992 on demand within Asia and an improving global economy. Shipments rose 32.1% yoy to HK$231.8bn (US$29.9bn), after gaining 28.5% in February. That topped the median estimate for a 25.2% gain in a survey. (Bloomberg)

Europe’s worsening debt crisis is intensifying pressure on policy makers to widen a bailout package beyond Greece after a cut in the nation’s rating to junk drove up borrowing costs from Italy to Portugal and Ireland. As German Chancellor Angela Merkel delays approval of a EUR45bn (US$59bn) Greek rescue, the crisis is spreading. Portugal’s benchmark stock index yesterday fell the most since the aftermath of Lehman Brothers Holdings Inc.’s collapse, while the extra yield that investors demand to hold Italian and Irish debt over bunds rose to a 10-month high. (Bloomberg)

South Korea’s current-account surplus advanced to a four-month high in Mar 10 as the global economic recovery spurred overseas demand for cars, semiconductors and petrochemicals. The surplus was US$1.69bn, the largest since Nov 09, from a revised US$167.6m in February. (Bloomberg)

Greece’s deepening financial crisis serves as a lesson for Japan, which needs to devise a “credible” fiscal plan to curtail the world’s largest public debt, an International Monetary Fund official said. “I don’t think the threat of a spillover from Greece will impact Japan for the moment,” Naoyuki Shinohara, deputy managing director at the International Monetary Fund, said in an interview in Washington yesterday.
  • Japan’s finances have come under scrutiny since January, when Standard and Poor’s cut the outlook of the nation’s AA rating to “negative.” Prime Minister Yukio Hatoyama’s government will unveil a fiscal plan in June to address a debt burden the Organization for Economic Cooperation and Development estimates is approaching 200% of gross domestic product. (Bloomberg)
Thailand’s economy may have grown between 8%-9% in 1Q as the global economic recovery boosted export orders, finance ministry spokesman Ekniti Nitithanprapas said. The first quarter wasn’t significantly impacted by political protests in Bangkok. Still, economic growth may slow in the second quarter, Ekiniti said.

Thailand’s tourist arrivals may fall as much as 10% this year as visitors shun the nation after anti-government protests turned violent, the Tourism Council of Thailand said. The number of foreign tourists may drop to as low as 12.7m, compared with 14.1m last year. The nation may lose as much as THB100bn (US$3.1bn) in tourism revenue, the industry body’s President, Kongkrit Hiranyakit, said. (Bloomberg)

Thailand’s Cabinet approved its fiscal budget for next year, and plans to increase spending by 22% percent to help bolster the economy amid political turmoil. The government plans to spend THB2.07tr in the 2011 budget period, which will start Oct. 1. The budget proposal will be discussed by Cabinet again on May 11 before being forwarded to the parliament for approval. (Bloomberg)

Greece’s credit rating was cut three steps to junk by Standard and Poor’s, the first time a euro member has lost its investment grade since the currency’s 1999 debut. Greece was lowered to BB+ from BBB+ by S&P, which also warned that bondholders could recover as little as 30% of their initial investment if the country restructures its debt. (Bloomberg)

Singapore’s visitor arrivals registered a 17.3% yoy growth to reach 928,000 in March (24.2%in Feb), It marked the highest ever recorded in the month of March and the fourth consecutive month of record visitor arrivals. (Bernama, Bloomberg)

Vietnam’s exports rose 8.9% yoy to US$20.1bn in January - April (-1.6% in Jan-Mar). Despite upbeat signs for exports, economists have remain worried about the trade deficit, which hit US$4.65 bn for the first four months, or 23.0% of the total export value. (Bloomberg)