Technical | Fundamental Analysis Discussion Stocks Listed In Bursa

Wednesday, April 14, 2010

KLCI, RHBCap, Petra, MRCB, Survey

DJ MARKET TALK: KLCI +0.1 On Tech Stocks; Broad Market Mixed

0439 GMT [Dow Jones] KLCI +0.1% at 1336.16, off earlier intraday high of 1341.52; technology stocks among biggest advancers, but other sectors mixed amid profit-taking on recent top performers. "The market started strongly following a positive cue from Intel's results, but the KLCI's failure to break out of it's week-long trading range spurred fresh selling pressure," dealer says; market's gains also capped by negative near-term technical signals, analysts say. Maybank Investment Research says if 1331 support is breached, "signs of a persistent steeper correction will emerge." Volume at 359 million shares, below recent midday average of 450 million-500 million. Among gainers, Unisem (5005.KU) +4.7% at MYR3.14, Green Packet (0082.KU) +4.5% at MYR1.15, JCY (5161.KU) +2.3% at MYR1.76; among decliners, Measat (3875.KU) down 4.8% at MYR3.36, Tan Chong (4405.KU) down 3.7% at MYR4.75

DJ MARKET TALK:AmResearch Keeps RHB Capital At Buy;MYR7.20 Target

0358 GMT [Dow Jones] AmResearch keeps RHB Capital (1066.KU) at Buy, with unchanged target price of MYR7.20; says banking group maintaining loans growth momentum, confident of achieving 15% growth in FY10; notes upside potential from bancassurance tie-up, following exclusive agreement with TM Asia to sell life insurance products for 10 years; RHB Capital intends to maintain dividend policy of 30% of net earnings. "There is a good chance RHB Capital may turn into a strong dividend paying stock over the longer-term," house says; adds despite recent rise, stock still "deeply undervalued" at 1.5X book value vs sector average of 2.0X. Stock +0.8% at MYR6.00.

DJ MARKET TALK: Affin Ups Petra Perdana To Add, Target To MYR1.81

0343 GMT [Dow Jones] STOCK CALL: Affin Research ups Petra Perdana (7108.KU) to Add from Reduce, target to MYR1.81 from MYR1.38 given expectations of earnings turnaround next year, primarily driven by higher vessel utilization and improvement in charter rates. "As all new vessels will be delivered before end 2010, bulk of the vessels' mobilisation costs and finance costs will be incurred this year," says analyst Loong Kok Wen; adds next year, house expects Petra to be able to secure charter contracts for most of its new vessels, thereby better match its heavy interest commitments (both on and off balance sheet financing; hence raises house FY11 earnings forecast for Petra by 24% to MYR39.8 million, FY12 by 19% to MYR49.1 million but trimmed FY10 forecast by 6% to MYR9.6 million as earnings will remain weak. Stock last down 0.6% at MYR1.65

DJ MARKET TALK: MRCB Flat; May Clinch Development Jobs - HwangDBS

0257 GMT [Dow Jones] Malaysian Resources (1651.KU) unchanged at MYR1.59, unaffected by key shareholder Employees Provident Fund's decision to allow takeover offer of MYR1.50/share to lapse, after EPF received acceptance amounting to only 3.3% stake. Dealers say EPF, which owns 38.6% of MRCB, unlikely to raise offer price; note earnings outlook for MRCB remains bright as property sector recovers. HwangDBS Vickers Research maintains Buy call on MRCB, with MYR2.25 target price; tips MRCB to be prime beneficiary of federal government's plan to develop 3,400 acres of land in central Selangor state as EPF has been tasked to spearhead project. "Besides this land, we do not discount MRCB participating in other lucrative government land (projects)," says HwangDBS.

DJ Asia Investors Optimistic In 1st Quarter But Risk Appetite Low - Survey

HONG KONG (Dow Jones)--Investors in Asia stayed fairly optimistic in the first quarter, but risk appetite remained low to moderate, according to the latest quarterly ING Investor Dashboard Survey.

ING's investor optimism index has remained around the same level over the past two quarters, coming in at 145 in the three months ended March 31 and 147 in the fourth quarter, double a low of 73 during the global economic crisis.

Investor sentiment in China and India continued to be the strongest in the region despite credit and monetary policy tightening in China and rising food inflation in India. Investors in Hong Kong and Singapore also stayed fairly optimistic. Currently, 73% of Hong Kong investors and 70% of Singapore investors expect a rise in local residential real estate prices in the second quarter.

Optimism in Southeast Asia was mixed, with investors in Malaysia and the Philippines being more optimistic while those in Indonesia and Thailand became more cautious because of political instability.

Despite the overall optimism, investors' appetite for risk remains "low to moderate," the survey found. Investors have been cautious of economic developments in the U.S. and China, and have been awaiting signs that the U.S. recovery will boost the job market before increasing investments.

Investors are also expecting inflation and higher interest, with 57% of survey participants--excluding those in Japan--expecting inflation to rise in the second quarter and 53% of Asia ex-Japan investors expecting domestic interest rates to rise during the quarter.

The ING Investor Dashboard survey tracks investor sentiment of "mass affluent" investors each quarter across 12 Asian markets. "Mass affluent" is defined as investors with disposable assets or investments of US$100,000 or more. The threshold for investors in the Philippines and Indonesia was lower at US$60,000. The survey is conducted by ING Groep (ING) with the Nielson Company.

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