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ASEAN STOCK WATCH Asean Affairs   13  April  2011

Asean markets to open lower

Shayne Heffernan

The Bank of Thailand (BoT) governor said on Tuesday that he expected the Thai baht to remain strong.

He said foreign capital inflows to equities and demand for baht from gold exporters also pushed up the Thai currency.

However, the baht had depreciated during the past few days as investors sold some assets ahead of the long holiday.

The BoT also reported that foreign reserves went up to US$184.6 billion on April 8, from $182 billion on April 1.

The net forward position stood at $21.3 billion, compared with $20.8 billion over the same period.

The reserve money expanded to 1.207 trillion baht on April 8, from 1.200 trillion baht on April 1, the central bank said.

The net claims on the government rose to 175.2 billion, from 161.5 billion baht. And the net claims on the financial institutions stood at minus 4.15 trillion baht, comparing with minus 1.2 trillion baht over the same period, according to the BoT.

The Government of Malaysia has announced a 10-year plan to strengthen its capital markets and win investment.

The plan promised to speed up approval for businesses, improve fund-raising rules and allocate more funds to venture capital and private equity firms through incentives and other support.

Malaysia said its goal is to almost triple the size of its capital market to $1.9 trillion by 2020.

Prime Minister Najib Razak also announced plans to list the federal land authority's sugar business on the stock market, boost Malaysia's ability to structure cross-border Islamic financial deals and gave a target to sovereign wealth fund Khazanah Nasional to sell non-core assets by year end.

'We are paving the way not only for a more equitable society but for a Malaysia that is more stable, more transparent and more market-friendly,' Mr. Najib told an annual gathering of Malaysian corporate leaders.
Jakarta will see further falls today and the best strategy today is to buy those quality stocks that will rebound.

Shayne Heffernan Strong Buys are

Bakrie Sumatera Plantations, one of Indonesia’s best plantation companies, fell 1.4 percent to Rp 355 and looked very oversold late in the day. Bakrie Sumatera shares fell after palm oil and rubber prices retreated, reducing its revenue outlook. September-delivery rubber lost as much as 3.8 percent to 457.2 yen per kilogram ($5,688 per ton) in Tokyo, while June-delivery palm oil fell 2.1 percent to 3,345 ringgit ($1,105) per ton in Kuala Lumpur.

Both Rubber and Palm Oil have good fundamentals for growth and will return to record highs this year.

Tambangraya Megah, a unit of Asia's best mining company Thai miner Banpu, shed 2.5 percent to Rp 48,100. Lower oil prices reduce the appeal of alternative fuels such as coal.

In Jakarta yesterday the JCI lost 26.61 points, or 0.7 percent, to close at 3,719.23, ending a four-day winning streak. About 2.7 billion shares valued at Rp 3.7 trillion ($429.2 million) changed hands. Decliners beat gainers 151 to 72.

News that Bank Indonesia decided to keep its benchmark interest rate unchanged at 6.75 percent saw the Jakarta Composite Index and the rupiah fall on Tuesday.

The rupiah fell 0.1 percent to trade at 8,655 to the US dollar as the market closed on Tuesday, from 8,649 on Monday.

Although Bank Indonesia kept its benchmark rate steady on Tuesday, analysts and economists are convinced it cannot maintain that stance for long in the face of rising consumer prices.

As expected, Bank Indonesia left its policy rate unchanged at 6.75 percent, relying on a strengthening rupiah to keep inflation in check. The rate stayed the same for a second successive month after a rise of 25 basis points in February, the first increase in more than two years.

But experts said inflationary pressures would increase in the second half, forcing the central bank to raise its rate.

Singapore will open lower today and the Shayne Heffernan best buys on the dip are Genting Singapore, owner of Resorts World Sentosa, the stock was oversold yesterday down 1.89 percent to S$2.08 as investors remained excessively wary about the group's prospects in the face of Singapore's Casino Regulatory Authority's investigations into alleged illegal activity relating to junket operations in the city-state's two casinos.

Genting Singapore, regardless of the Singapore's Casino Regulatory Authority's rates a strong buy.

Crude palm oil stocks were also oversold, with Golden-Agri Resources was down 2.8 percent at S$0.705 and Wilmar International down 1.3 percent at S$5.23 on concerns about oversupply of palm oil.

Golden Agri and Wilmar will recover very fast.

Maybank and Sime Darby stand out on the Bursa Malaysia today as the market will open lower.


Malayan Banking Berhad (Maybank) is engaged in the business of banking and finance. Through its subsidiaries, Maybank operates in six segments, which include consumer banking, business and corporate banking, global market, investment banking, insurance and asset management and international banking.

Its global market segment comprises the full range of products and services relating to treasury activities and services, including foreign exchange, money market, derivatives and trading of capital market instruments. Its investment banking segment comprises the business of an investment bank, discount house and securities broker. Its insurance and asset management segment comprises the business of underwriting all classes of general and life insurance, offshore investment life insurance, general takaful and family takaful, asset and fund management, nominee and trustee services and custodian services.

Shayne Heffernan strong buy, Sime Darby, the world’s largest listed palm oil producer, will make its first investment in Africa, with the establishment of plantations in Liberia in April.

Sime Darby is Malaysia’s second-largest company by value, with a market capitalisation of 47 billion ringgit. It owns more than 5,000 square kilometres (1,930 square miles) of palm oil plantations in Malaysia and Indonesia.

Sime Darby was granted a 63-year concession in 2009 to develop 220,000 hectares (543,500 acres) of land in Liberia, will begin planting oil palm on 10,000 hectares in the first phase.

“This foray is most significant as it allows us to explore opportunities for further growth and development in other emerging markets and regions,” said Franki Anthony Dass, executive vice-president of Sime Darby Plantation.

Sime Darby, which already has palm oil plantations in Malaysia and Indonesia, will invest 70 million ringgit ($23 million) in the project, Dass added in a statement.

In Kuala Lumpur the KLCI index lost 18.08 points or 1.17% to close at 1525.  


The Winners were AXIATA (+2 sen to RM4.72), KLK (+18 sen to RM21.00), TENAGA (+2 sen to RM6.07), PLUS (+3 sen to RM4.46) and PETDAG (+2 sen to RM16.32).

The Losers were MAYBANK (-24 sen to RM8.74), GENTING (-34 sen to RM10.76), PETCHEM (-24 sen to RM7.05), SIME (-9 sen to RM9.17) and IOICORP (-7 sen to RM5.50).

Market breadth was negative with 166 gainers as compared to 682 losers.

The Finance Index fell 1.65 percent to 13943.33 points, the Properties Index dropped 1.16% to 1094.25 points and the Plantation Index down 0.62 percent to 7672.78 points.

The market traded within a range of 17.31 points between an intra-day high of 1539.46 and a low of 1522.15 during the session.Trading volume decreased to 1088.19 mil shares worth RM1527.99 mil as compared to Monday's 1470.45 mil shares worth RM2179.21 mil.

The Stock Exchange of Thailand will open lower today, troubles on Wall St overnight will give investors a great opportunity to take a position in Shayne Heffernan strong buys Sri Trang,  PTT and Banpu.

Oil, Coal and Rubber have traded lower over the last few days and this will be reflected in Bangkok today.

PTT Public Company Limited is a Thailand-based company engaged in the in upstream petroleum, downstream petroleum, coal business and other related businesses.

Its business activities include the exploration for, the development and production of, natural gas, condensate and crude oil through subsidiaries; the procurement, transmission, processing, marketing and distribution of natural gas and gas products; the marketing of refined products through various distribution channels including commercial, retail, reseller and international markets, and the import and export of crude oil, condensate, petroleum feedstock and petrochemical products.

Banpu Public Company Limited (Banpu) is a Thailand-based company engaged in coal mining and power businesses. The Company has operations in Thailand and overseas, including Indonesia and the People’s Republic of China.

Banpu supplies coal through its mines in the Lampang and Payao Provinces and via imported coal from Indonesia. The Company's current operations in Indonesia are located in Jorong, Indominco, Kitadin, Trubaindo and Bharinto. In China, Banpu has mining projects in Daning, Hebi and Gaohe.

Sri Trang Agro-Industry Public Company Limited is a Thailand-based company engaged in the manufacture of rubber products.

The company’s product includes rubber smoked sheet (RSS), which are used as a raw material in the production of other products, including automobile tires, pipes, shoes and parts of automobiles; block rubber, which is used in the automobile tire industry, and used as substitute to grade-3 rubber smoked sheet, and concentrated latex, which can be used as a raw material in the production of latex examination gloves, condoms, and elastic rubber thread.

Its customers are categorized in three groups: automobile tire manufactures, such as Bridgestone, Michelin, Yokohama, Hankook, Continental, Goodyear, Pirelli, and tire manufacturers in China; trading companies in Japan and other importers in Asia, China, Taiwan, Korea, America and Europe, and domestic customers, including automobile tire, motorcycle tire, and elastic rubber thread manufacturers

In Bangkok yesterday The Stock Exchange of Thailand (SET) composite index on Tuesday gained 8.58 points, or 0.80 per cent, to close at 1,084.91 points. The market value was 26.35 billion baht, with 2.73 billion shares traded.

The SET100 index ended the session at 1,669.31 points, up 14.34 points, or 0.87 per cent, with a total trade value of 23.10 billion baht.

The SET50 index rose 6.88 points, or 0.91 per cent, to stand at 767.00 points, with a total transaction value of 20.50 billion baht.

The Market for Alternative Investment (mai) index moved up 0.91 point, or 0.31 per cent, to stay at 291.83 points, with a total turnover of 621.85 million baht.

Top five most active values were as follows;

PTT closed at 371.00 baht, up by 3.00 or 0.82 percent.

PTTEP closed at 191.50 baht, down by 1.50 or 0.78 percent.

BBL closed at 180.00 baht, down by 1.50 or 0.83 percent.

SCB closed at 116.50 baht, up by 1.50 or 1.30 percent.

TOP closed at 83.25 baht, up by 0.75 or 0.91 percent.

In Singapore yesterday The Straits Times Index lost 22.44 points to end at 3,138.00.

Investor sentiment was hit by the disappointing Alcoa earnings and increased troubles at Japan's nuclear reactor.

The Winners were Olam International, which rose 2.8 percent to S$2.95 on news India's Tata Chemicals will take a 25.1 percent stake in its Gabon port-based ammonia urea fertiliser complex joint venture.

Commodities finished lower across the board Tuesday, led South by a 3.5% sell off in the Grains. July Wheat finished lower by 4.8 percent to 7.92 per bushel in profit taking from its recent run to above 8.

May Crude Oil fell 3.3% to settle at 106.25 bbl, extending its sell off to a 2nd straight session. Crude Oil has now shed over 6.50 or 5.8 percent from yesterday morning's 2.5 yr. high at 113.46.

Further headline risk shook out speculative money that recently pushed Crude Oil to those 2.5 yr highs.

 It was an quiet session for May Nat Gas, which finish near unchanged at 4.10 per MMBtu.

The sell-off in Crude Oil dampened the precious metals sector, with Jun Gold falling 0.9% to 1453.60 oz, and May Silver dropping 1.4 percent to finish at 40.06 oz. Neither metal was able to retrace their mid-morning sell off.

Manila will fall again today and the banks look like great buys after continued falls over the last week.

Shayne Heffernan Best Buys are

Metrobank and Banco de Oro

Metropolitan Bank & Trust Company is a Philippines-based bank. The Company principal business activities involve deposit-taking and lending, trade finance, remittances, treasury, investment banking and thrift banking. It provides investment banking services through First Metro Investment Corporation (FMIC) and retail banking through Philippine Savings Bank (PSBank).

The Bank is also a major participant in the foreign exchange market in the Philippines of over 800 local and international branches, offices and agencies. The Company provides services, such as deposit products, loans and trade finance, domestic and foreign fund transfers, treasury, foreign exchange, trading and remittances and trust services.

Banco de Oro Unibank, Inc., the country’s largest bank, with over P1 trillion in assets, reported a net income of P8.8 billion in 2010, 46 percent higher than in 2009.

“Continuing reforms have sustained the banking system’s soundness and stability, enabling it to perform a catalytic role for a more dynamic and participatory development. Banks balance sheets have been strengthening. NPL (nonperforming loan) ratios have been below the pre-1997 crisis level of 4 percent,” central bank Governor Amando M. Tetangco, Jr. said during his speech during a Management Association of the Philippines (MAP) meeting last Tuesday.

Banco de Oro Uni Bank Inc. (BDO) offers an array of products and services that include retail banking, lending (corporate, commercial, consumer and SME), treasury, trust, credit cards, corporate cash management and remittances. Through its subsidiaries, the Bank offers leasing and financing, investment banking, private banking, bancassurance, insurance brokerage and stock brokerage services.

As of December 31, 2010, it had 726 operating branches and more than 1,400 automated teller machines (ATMs) nationwide. Some of the Bank’s subsidiaries are BDO Private Bank Inc., BDO Strategic Holdings, Inc, BDO Elite Savings Bank, Inc, BDO Insurance Brokers, Inc., PCIB Europe, S.P.A., BDO Remittance (USA), Inc. and Express Padala Frankfurt GmbH.

In Manila yesterday the Philippine Stock Exchange index fell 28.51 points 0.67 percent, to end at 4,199.48.

The index ended in negative territory for the second day in a row, as expected by many analysts and as investors reassessed gains following the run-up in the last two weeks.

The losers were AGI, Metrobank, ICTSI, PLDT, DMCI, Metro Pacific Investments, Ayala Corp., SM Investments, San Miguel Corp., EDC, Cebu Air, Banco de Oro, BPI, Megaworld, Leisure & Resorts, Universal Robina and Aboitiz Equity Ventures.

Philippine National Bank, the second most actively traded stock, defied the day's downtrend, rising by 6.5 percent to finish at P67.50.

The Winners were PNB, Filinvest Land also defied gravity on Tuesday.

Value turnover was thin at P4.38 billion.

Shayne Heffernan brings more than 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over US$500m and 1 that reach a peak market cap of US$15billion. He has managed and overseen start-ups in Mining, Shipping, Technology and Financial Services.


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This year in Thailand-what next?

AseanAffairs   04 January 2011
By David Swartzentruber      

It is commonplace in journalism to write two types of articles at the transition point between the year that has passed and the New Year. As this writer qualifies as an “old hand” in observing Thailand with a track record dating back 14 years, it is time take a shot at what may unfold in Thailand in 2011.

The first issue that can’t be answered is the health of Thailand’s beloved King Bhumibol, who is now 83 years old. He is the world's longest reigning monarch, but elaborate birthday celebrations in December failed to mask concern over his health. More






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