Friday, May 14, 2010

20100514 1901 FCPO Weekly Chart Study.

FCPO closed : 2456, changed : -63 points, volume : lower.
Bollinger band reading : downside biased.
MACD Histrogram : continue lower, seller taking some position.
Support : 2450, 2400, 2350 level.
Resistant : 2500, 2530, 2580 level.
Comment :
FCPO continue to trade weaker in quiet transaction. Weekly chart started to shows a weaker negative downside biased development that is near crucial trendline support level.

20100514 1849 FCPO EOD Daily Chart Study.

FCPO closed : 2456, changed : -16 points, volume : higher.
Bollinger band reading : downside biased.
MACD Histrogram : continue lower, seller in control.
Support : 2450, 2400, 2370 level.
Resistant : 2470, 2500, 2521, 2550 level.
Comment :
FCPO continue to trade lower today with improving volume transacted due to weaker soy oil futures price development. Daily chart starting to shows a downside negative biased market to take place in the near term testing lower support level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant/strength/breakdown with quick cut loss and profit target.

20100514 1743 FKLI Weekly Chart Study.

FKLI closed : 1338, changed : +13.5 points, volume : lower.
Bollinger band reading : bullish biased.
MACD Histrogram : fall below zero line, buyer offloading + seller present.
Support : 1335, 1310, 1300 level.
Resistant : 1350, 1360, 1375 level.
Comment :
FKLI managed to recover some of last week losses forming a weekly doji bar candle with lesser volume traded. Weekly chart reading having some mixed reading as Bollinger band still shows a bullish biased market but MACD Histrogram sending a market's strength weakening signal. Overall, expect a continue side way range bound market as it is just too easy to call for a downside biased market unless something drastic happen.

20100514 1732 FKLI EOD Daily Chart Study.

FKLI closed : 1338, changed : -3.5 points, volume : higher.
Bollinger band reading : side way range bound.
MACD Histrogram : receovering, buyer defending
Support : 1337, 1330, 1325 level.
Resistant : 1345, 1350, 1360 level.
Comment :
FKLI shows an unwelcome sign after Bank Negara raised interest rate by quatter percent ended the day lower in improving volume despite a better GDP achieved for the 1st 3 months of the year.  Daily chart reading remained side way range bound testing support and resistant.
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.

20100514 1552 Malaysia Corporate News.

The board at Sime Darby has asked CEO Datuk Seri Zubir to take a leave of absence following huge cost overruns and project losses at its energy and utilities division. A workgroup set up to review the losses at the divisions estimates a negative impact of RM964m on Sime's 2HFY10 results.
  • Asked if Zubir was fired by the board, Sime Darby chairman Datuk Musa Hitam said "it was up to the people to interpret. The fact is he has left the Group as of today". Pending the appointment of a new group CEO, Datuk Azhar, currently executive VP plantation division has been appointed acting CEO. 
  • The RM964m loss was derived from RM450m further losses allocated for Bakun dam project, reversed RM200m revenue from Qatar Petroleum job, RM159m further losses from Maersk Oil Qatar project and RM155m provision for the marine project. (Financial Daily)
Palm oil futures declined to the lowest level in three weeks as crude oil retreated for a third day and soybeans fell. July-delivery palm oil lost as much as 1.6% to RM2,466/tonne ton and closed at RM2,472/tonnet on the Malaysia Derivatives Exchange. Soybeans for July delivery in Chicago fell as much as 0.4% to US$$9.6125/bushel and last traded at $9.615 while soybean oil lost 0.4% at 38.28 cents a pound.
  • The premium of soybean oil over palm oil widened for a third day to US$69.64/tonne, compared with a 12-month average of US$129.72/tonne. India, the world’s secondbiggest vegetable oil consumer after China, may boost imports of soybean oil by 80% this year as its premium over palm oil narrows amid a record global soybean crop, says Govindlal G. Patel, director of vegetable oils trading company Dipak Enterprise. (Bloomberg)

DiGi's EBITDA margin for 2010 may face some pressure due to its higher level of handset subsidies. "We had a strong 1Q10 with EBITDA margin of about 45%. We expect this to go to last year's level mainly due to handset subsidies," he said. The telco achieved an EBITDA margin of 43.3% last year.
  • The subsidies were coming more into play as DiGi drove smarphone sales not just for iPhone but also other phones such as the Android. Dennlind said while its EBITDA margin would continue to be under some pressure but it targeted to improve the margin with further cost optimisation measures. 
  • He also added that DiGi was optimistic of growth and that the group was in a great position in terms of capital management and was looking to maintain its dividend policy of 80% payout. (Starbiz)
Green Packet believes the worst is over and expects remaining quarters to perform better than 1Q10, says group CEO Puan Chan Cheong. Although 1Q10 expanded to RM44m from RM22m in the same period last year, the company remained optimistic that it will be able to achieve an EBITDA break even by the end of this year.
  • 1Q10 EBIDTA loss was RM29.8m compared to 4Q09's RM56.2m loss. "These are planned losses, as we need to invest heavily to roll out our broadband coverage. In 2Q10, we expect EBITDA losses to be narrower, and by the end of this year, we will break even," said Puan. 
  • Puan attributed the improvements in remaining quarters to its growing broadband subscriber base, as well as expansion in coverage. Firm currently has 175,000 broadband customers, as it added 35,000 new customers in 1Q10. It expects a significant increase in the second half, as laptops that have built-in WiMAX chips will be launched then. "We expect more than 10 WiMAX embedded notebooks or netbooks to be launched starting in July," said Puan.
  • The company, which secured a WiMAX spectrum in Singapore recently, said it is still developing its business plan for the market. It expects to conduct trial in the second half of this year. It also added that it remains committed to commercially launch its broadband services in 2H10, although it warned that commercial launch may be delayed to 1H11. (BT)
Seeking to assuage fears of big four mobile service providers, including Bharti, of huge payout for excess spectrum telecom regulator, the Indian regulator TRAI on Thurs said their outgo would be only about Rs 120bn (US$2.7bn). "There is no need for anxiety ... the payout for each of these four companies are not much. As per TRAI estimations, the amount of money Bharti will have to pay is Rs 35bn (US$0.8bn) and for Vodafone Essar it is Rs 28.5bn (US$0.6bn). For MTNL, it is Rs 27bn (US$0.6bn) and for BSNL it is Rs 30.4bn (US$0.7bn)," TRAI Chairman J S Sarma told PTI. Sarma said this outgo would also come down if the proposed licence fee of 6% comes into picture. In that case, the net outgo for Bharti would be Rs 15bn (US$0.3bn). (Economic Times of India)

AirAsia will be flying to Teheran, Iran, from July onwards, expanding its range of destinations in the Middle East. Transport Minister Datuk Seri Ong Tee Keat said this will make the airline the only low-cost carrier to serve the region.
  • He said the flights, which will run 5x weekly, was consistent with the government's aim to strengthen greater air links with the Middle East. Malaysia Airlines currently flies to eight Arab countries including Saudi Arabia, Jordan, Oman and Lebanon at a frequency of 33x weekly, including 21 routes under the MAS codeshare policy.
  • "We currently have Air Service Agreements with 11 Arab countries. Of the 11, we have liberal traffic rights or no restrictions on passenger capacity, frequency and aircraft type in six countries. The countries with liberal traffic rights are namely Bahrain, Lebanon, Oman, Qatar, the United Arab Emirates and Yemen. (BT)
Oman Air plans to sign a code- share agreement with national carrier Malaysia Airlines by June 1. "Our growth in the east has been very minimal. We have been looking for a strategic partner and MAS fits the bill," says Oman Air chief commercial officer Barry Brown. Currently, KL is only Oman Air's second destination in the east, the other being Bangkok. The carrier started four weekly flights between Muscat and KL on May 1. Brown said he expects an initial load factor of 75-85% for the Kuala Lumpur-Muscat-Kuala Lumpur route.(BT)

Petronas has signed its first deal with Venezuela to develop oil projects in the country. Together with partners Repsol YPF, ONGC Videsh Limited, Indian Oil Corporation Limited and Oil India Limited, Petronas will develop blocks located in the Orinoco Heavy Oil Belt. The upstream facilities are expected to produce around 400,000 barrels per day of extraheavy oil. The licence term is for 25 years with the potential for a further 15-year extension to extract oil. (AFP)

New Hoong Fatt Holdings
will spend RM36m capex this year, which include increasing factory capacity by 10% to 80% this year to tap on the rebounding automotive market in the country and the region, says MD Chin Jit Sin.
  • Of the RM36m, RM8m will be used to build a new factory on 2.4ha next to its existing two plants Klang, Selangor. "The automotive market is already rebounding, especially under the Asean Free Trade Area which came into effect Jan-10, with zero import duties for all automotive parts among Asean countries," says Chin. 
  • The new factory is expected to be completed by 3Q10 and would focus on ramping up plastic-based automotive parts. Chin said the firm will also spend RM12m to develop new products to prepare for a rebounding or a growing car market at its export destinations in 40 countries, especially in China and India which is rapidly rolling out cars from production lines and importing in huge volumes.
  • Exports account for 22% of the group's total revenue and provide automotive spare parts to the local replacement market, 1,400 wholesalers, retailers and automotive repair shops nationwide. (BT)

20100514 1541 Malaysian Economic News.

Gross domestic product (GDP) grew 10.1% in 1Q10 (4.4% in 4Q09), the highest registered in 10 years, when compared with the 11.7% registered in 1Q00. On the supply side, all major economic sectors recorded robust growth, particularly the manufacturing sector (+16.9%).The services sector also registered a strong performance of 8.5%, followed by the construction sector (8.7%), agriculture sector (6.8%) while the mining sector turned around to register 2.1% growth.
  • On the demand side, growth during the quarter was underpinned by strong domestic expenditure due to sustained expansion in private and public consumption at 5.1% and 6.3% respectively. 
  • Malaysia is on track to reduce its budget deficit to 5.6% this year (7.0% in 2009), said PM Datuk Seri Najib Tun Razak.
  • The country's GDP forecast for the year was also revised during the presentation of the fiscal budget in October while Najib noted that 6.0% growth is achievable. (Bernama) 
Bank Negara Malaysia (BNM) decided to raise the overnight policy rate (OPR) by 25bp to 2.50%. This is the second interest rate hike for the year. The floor and ceiling rates of the corridor for the OPR are correspondingly raised to 2.25% and 2.75% respectively. (BNM, Financial Daily)

Central bank Governor Zeti Akhtar Aziz said the next few quarters would show an improvement in economic growth but may not post such a huge yoy increase of 10.1% seen in 1Q10. “What is more important are actual economic activity increases and we are projecting that growth qoq will improve,” she added. (StarBiz)

The Malaysian Ringgit is “retracing back” to previous levels after depreciating “very significantly” in 2008 and part of 2009, central bank Governor Zeti Akhtar Aziz said. “We believe different industries will benefit from the movements in the exchange rate. This is something we highlighted to manufacturers several years ago, that they have to manage increased volatility of the exchange rate and they should not rely on the exchange rate to gain their competition,” Zeti noted. (Bloomberg)

Central bank Governor Zeti Akhtar Aziz said volatility in the financial market could be expected as a result of the development in Europe and other advanced economies. “We should be abale to absorb this volatility. At the macro level, we have strong reserves, strong balance of payment, current account in surplus, an external debt which is low, high savings rate as well as ample liquidity in the financial sector,” she said. (BT)

The new basic motor insurance to replace the existing third-party motor insurance will be implemented by early next year. The scheme comes with a liability limit of up to RM2m ad settlement time is targeted to be between two and four weeks. A Finance Ministry source told that the Government would have to subsidies the new scheme if the current premiums were to remain. (The Star)

20100514 1537 Global Economic News.

Federal Reserve Vice Chairman Donald Kohn said pledges to keep interest rates at a given level shouldn’t be unconditional and should change as the economy evolves. “Commitments to maintain interest rates at a given level must be properly conditioned on the evolution of the economy,” Kohn said today in remarks to a monetary conference at Carleton University in Ottawa, Canada. Policy makers will weigh the impact of financial turmoil in Europe on U.S. growth when they next meet June 22-23. (Bloomberg)

The number of first-time filers for unemployment insurance in US fell last week for a fourth straight week, according to a weekly government report released Thursday. There were 444,000 initial jobless claims filed in the week ended May 8, down 4,000 from a downwardly revised 448,000 the previous week, according to the Labor Department's weekly report. The number of claims is the lowest since the 442,000 reported in the week ended March 27. Economists surveyed by had expected new claims to fall to 440,000. (CNNMoney)

Federal Reserve Chairman Ben Bernanke said Wednesday he has concerns about a signature piece of Senate Democrats' Wall Street financial reform package. Bernanke wrote about the consequences from a congressional ban preventing banks from trading the complex financial products, called derivatives, in a letter to key lawmakers.
·    "Forcing these activities out of insured depository institutions would weaken both financial stability and strong prudential regulation of derivative activities," Bernanke wrote to an author of the measure, Senator Christopher Dodd, D-Conn. (CNNMoney)

The US foreclosure plague may have finally reached its peak in April 2010 -- but don't expect delinquency statistics to plummet anytime soon. The total number of foreclosure filings -- notices of default, auction notices and bank repossessions -- fell by 9% from March to April, and 2% compared with April 2009, according to data released Thursday by RealtyTrac, the online marketer of foreclosed properties.
  • The number of homes repossessed during April is at an all-time high of 92,432. That is a 45% increase over April 2009. If repossessions continue at this pace, more than 1.1m homes will be lost in 2010. (CNNMoney)
Thailand’s prime minister withdrew an offer of early elections, raising the chance of renewed clashes with protesters who have occupied Bangkok streets for two months. “Since they didn’t end the protest, that means they reject the offer,” Premier Abhisit Vejjajiva told reporters in Bangkok today. “The election date is now up to me to decide.” (Bloomberg)

Thailand’s consumer confidence fell for a third consecutive month as the nation’s worst political violence in 18 years claimed 27 lives in April. An index measuring sentiment dropped to 67.2 last month from 69.8 in March, the University of the Thai Chamber of Commerce said in Bangkok today. That’s the lowest level in nine months. The gauge is based on a survey of 2,239 respondents. The prolonged unrest may reduce growth this year by as much as two percentage points, Finance Minister Korn Chatikavanij has said. (Bloomberg)

China's government has opened a new range of government-run industries to the private sector, either through investment in existing companies or establishment of new firms. The government would improve financing services and simplify administrative procedures for private sector involvement in those industries.
  • Water projects, power generation, mining, and logistics -- currently mainly state controlled -- would be opened to the private sector, said a statement on the central government website, 
  • The statement also reiterated the opening of sectors, including education, welfare, transport infrastructure, telecommunications and energy, public utilities, scientific and technological programs for national defense, affordable housing construction and cultural industries. (Xinhua)
Japan’s current-account surplus widened to JPY2.53tr in March (JPY1.47tr in Feb) on exports, a sign overseas demand is sustaining a recovery in the world’s second-largest economy. Economists had projected for JPY2.17tr. (Bloomberg)

China’s foreign direct investment climbed 25.0% yoy for a ninth month in April (12.1% in Mar) as the government relaxed rules to lure investors amid a sustained economic expansion. That compares with the 21.4% median forecast. (Bloomberg)

India’s food inflation rate climbed 16.44% yoy in the week ended 1 May (16.04% in the previous week). Finance Minister Pranab Mukherjee said prospects of sufficient rains this year will help bring down prices. (Bloomberg)

The Philippine central bank said its next monetary policy decision will be a “tight balancing act” as policy makers decide whether it’s time to raise interest rates or ask lenders to set aside more deposits as reserves. Bangko Sentral ng Pilipinas needs to be careful it doesn’t increase borrowing costs unnecessarily because it may erroneously “signal to the market” that rates will rise further, Deputy Governor Diwa Guinigundo said.
  • “We may even choose not to touch both if we think the global and domestic economic recovery remains fragile and if the inflation outlook continues to be favorable,” he added (Bloomberg)