ASEAN KEY DESTINATIONS
Asean Stock Watch- August 19
The Dow Jones Industrial Average closed down 419.63 points, or 3.68 percent at 10,990.58.
The S&P 500 dropped 53.24 points, or 4.46 percent to 1,140.65.
The Nasdaq composite fell 131.05 points, or 5.22 percent to 2,380.43.
All 10 S&P sectors closed down sharply, led by energy and materials.
Nymex crude oil closed at US$ 81.45 a barrel, while gold settled at $1,837.60 an ounce.
Overnight, the Dow Jones Industrial Average rose 4.28 points to 11,410.21 after firms reported higher earnings but issued mixed projections on how the sluggish economic growth and higher costs would affect their profitability.
Stocks rebounded on Thursday, sending the benchmark index to its highest in more than two weeks, after the president said the government would boost spending in an effort to accelerate economic growth.
The Jakarta Composite Index gained 67.72 points, or 1.7 percent, to close at 4,020.99, after closing down 0.2 percent on Tuesday. It was the measure’s highest since Aug. 1, when it closed at record 4,193.44. Financial markets in Indonesia were closed on Wednesday for Independence Day.
More than 6.07 billion shares worth Rp 6.08 trillion (US$710 million) were traded. Gainers outnumbered decliners, 148 to 81. Foreign investors bought Rp 26 billion more than they sold.
The infrastructure sector on the Indonesia Stock Exchange gained 2.4 percent, on expectations that higher construction spending would boost profits at building-material makers.
Semen Gresik, the nation’s largest listed cement maker, grew 2.3 percent to Rp 9,100, while rival Indocement Tunggal Prakarsa rose 2.7 percent to Rp 15,400. Panin Sekuritas in a note to customers on Thursday said that the Indonesia Cement Association revised its cement sales growth target up to 11 percent, from 10 percent, bringing this year’s targeted sales to 45 million tons.
Indosat, Indonesia’s second largest cellular provide, jumped 6.4 percent to Rp 5,800. Its first-half profit surged 138 percent on a year earlier to Rp 682 billion.
Multistrada Arah Sarana, the second-largest listed tire maker, climbed 3.6 percent to Rp 570. Investor Daily reported that three tire producers were looking to buy a 40 percent stake in the company.
The rupiah fell 0.1 percent to 8,533 against the US dollar.
Share prices on Bursa Malaysia ended mixed in thin trade today with profit taking and bargain hunting emerging after previous gains and sell off, an analyst said.
At 5pm, the FBM KLCI rose 0.23 of a point or 0.01 percent to 1,503.3.
The benchmark index had opened 3.64 points higher at 1,506.71 and hovered between 1,497.37 and 1,507.59 for the day.
However, losers overwhelmed gainers by 445 to 265 while 308 counters closed unchanged and 476 others untraded.
Volume declined to 850.55 million shares worth RM1.71 billion compared with 892.81 million shares valued at RM1.6 billion yesterday.
The analyst said the market gains were limited as investors cut their exposure following an escalation in the euro zone debt crisis and downgrade of the U.S. debt rating.
A weak regional market following negative performance overnight on Wall Street weighed on investors sentiment as the meeting between German chancellor Angela Merkel and French president Nicolas Sarkozy was unable to restore confidence in the euro zone.
"The local market started firmer before profit taking set in the key heavyweight counters and lower liners until end of the day," another analyst said.
The Finance Index rose 16.63 points to 14,312.82, the Plantation Index fell 32.37 points to 7,307.25 and the Industrial Index added 21.2 points to 2,784.
The FBM Emas Index declined 7.58 points to 10,305.47, the FBM Mid 70 Index dropped 9.03 points to 11,312.7 and the FBM Ace Index shed 41.38 points to 3,856.36.
MAA Holdings was among the active stocks. It was up five sen to 61 sen.
DVM Technology fell 1.5 sen to 14 sen, Wijaya Baru Global-Wa was flat at 19 sen, Axiata rose two sen to RM5.00 and Hap Seng Cons-Wa declined 3.5 sen to 47 sen.
As for heavyweights, Maybank rose two sen to RM8.70, CIMB was flat at RM8.15, Sime Darby gained six sen to RM8.94, Petronas Chemicals fell one sen to RM6.58 and Maxis lost one sen to RM5.35.
Of the top gainers, PPB Group jumped 32 sen to RM17.50, Metrod rose 30 sen to RM3.70, UMW increased 22 sen to RM7.45, MISC gained 20 sen to RM7.30 and Tradewinds Plantation went up 20 sen to RM3.49.
Esso Malaysia was among the losers following the sale of a 65 percent controlling stake to San Miguel Corp, which will also be required to extend a mandatory takeover offer at RM3.50 per share.
Its stock fell 18.59 per cent or 92 sen to RM4.03.
Volume on the Main Market fell to 672.024 million shares worth RM1.68 billion from 619.15 million shares valued at RM1.55 billion yesterday.
Turnover on the ACE market declined to 116.87 million units valued at RM19.88 million from 201.42 million units worth 37.68 million previously.
Warrants shed to 59.51 million units worth RM6.48 million from 64.71 million units valued at RM7.67 million on Wednesday.
Consumer products accounted for 48.83 million shares traded on the Main Market, industrial products 132.23 million, construction 32.48 million, trade and services 226.42 million, technology 21.86 million, infrastructure 6.59 million, finance 97.73 million, hotels 845,400, properties 63.13 million, plantation 37.14 million, mining 71,000, REITs 3.17 million and closed/fund 71,000.
The FBM KLCI futures on Bursa Malaysia Derivatives fell in early trade Friday on lack of buying interest.
Dealers said the negative vibes following Wall Street's negative performance overnight would surely be felt across the region.
At 10am, Aug 2011 was 9.5 points lower at 1,492.5, Sept 2011 fell 8.5 points to 1,487, Dec 2011 declined nine points to 1,484 and March 2012 untraded at 1,483.
Turnover stood at 4,295 lots while open interest amounted to 20,553 contracts.
The underlying FBM KLCI declined 1.17 percent to 1,485.68.
Philippine share prices on Thursday returned above the 4,400-level on easing concerns overseas after Fitch Ratings maintained its top credit rating on the US.
At the Philippine Stock Exchange, the composite index jumped 63.27 points, or 1.46 percent to 4,403.54, while the broader all-shares index rose by 22.66 points, or 0.75 percent to 3,058.04.
Advancers led decliners, 89 to 46, while 44 stocks were unchanged. A total of 3.77 billion stocks worth P5.07 billion changed hands.
“Investors may have taken a flat US market as an early signal pessimism in that economy is dissipating. This gets an added boost as Fitch Ratings joined Moody’s Investors Services in keeping the US at a top AAA rating, leaving only S&P with the downgrade,” said Jun Calaycay of Accord Capital Equities Corporation.
“This should ease some of the concerns, leaving the onus on the European economic zone to come up with a viable and acceptable solution, and take action to smooth markets’ ruffled feathers. If another recessionary cycle is to come, it will most probably originate from that region,” Calaycay added.
Calaycay said the PSEi validated the 4,330-support line, rising 9 points at the opening bell before accumulating gains to join Southeast Asian peers in ignoring the weakness in the broader Asia region.
The return of the index above the 4,400-mark “should invite attention” and add more signs to the resiliency of domestic stocks, Calaycay said.
Immediate support is met at the 4,430 to 4,450 range.
It is however a different story at the foreign exchange market, as the peso continued to lose track against the dollar amid more cautious investors.
At the Philippine Dealing System, the local unit lost 6.5 centavos to close at 42.51 against the greenback on Thursday from 42.445 the previous trading day.
The dollar-peso pair opened at 42.43 and moved to a high of 42.53 and to a low of 42.40.
Total trading volume eased to $648.37 million and $736.64 million last Wednesday.
In a commentary, Metropolitan Bank and Trust Company said the peso has appreciated by three percent as of August 15 and is likely to go up in the coming months.
Pauline Revillas, Metrobank research analyst, said this could be considered a “double-edged sword.”
“Those that benefit from the appreciation are the government through lower debt servicing and consumers, including businesses, which consume imported products. On the other hand, those adversely affected are OFWs and the recipient families, exporters, and also the government through the reduction in revenues from imports,” Revillas said.
While the country’s import bill might decline, the savings can be offset by the reduction in spending of many of the beneficiaries of remittances, she said.
“If the peso reaches 41.50 to a dollar by yearend, from 43.84 in December last year, it means a decrease of P234 for every $100 they remit. And based on last year’s level of remittance, it translates to a loss of almost P44 billion pesos in purchasing power. Indeed, a significant amount that could affect overall economic growth especially since the Philippine economy is largely consumption spending-based,” Revillas said.
She added that the strong currency could be “a boon or a bane” depending on how fiscal and monetary policies are implemented.
She said the increase in government spending—amid the savings in interest payments—could help make up for a possible slowdown in consumption spending. Similarly, the lower import costs should be passed on to consumers to support their spending.
On the monetary side, the Bangko Sentral ng Pilipinas could stem the rapid appreciation of the peso by holding policy rates steady until the “dust settles in global financial markets,” Revillas said.
“After all, a higher interest rate could attract more hot money flows that support peso appreciation,” she said.
“It is still safe to say that no major move is still required. The Philippines can somehow afford to stay in the sidelines and not be significantly affected by the volatile financial and currency markets on the back of still strong macroeconomic fundamentals,” she added.
Singapore shares opened lower on Friday, with the benchmark Straits Times Index at 2,745.61 in early trade, up down 2.8 percent, or 79.35 points.
Around 91.6 million shares exchanged hands.
Losers beat gainers 214 to 12.
The Stock Exchange of Thailand main index went down 4.42 points or 0.40 percent to close at 1,089.09 points at the end of trading session on Thursday. The trade value was 45.09 billion baht, with 5.44 billion shares traded.
The SET50 index ended at 758.83 points, down 2.00 points or 0.26 percent, with a total trade value of 23.21 billion baht.
The SET100 index fell 4.98 points or 0.30 percent to stand at 1,654.86 points, with a total turnover of 27.59 billion baht.
The SETHD index went down 4.83 points or 0.46 percent to stand at 1,043.09 points, with total trade value of 8.19 billion baht.
The MAI index dropped 2.58 points or 0.83 percent to close at 307.05 points, with total transaction value of 749.80 million baht.
Top five most active values were as follows;
BBL closed at 162.00 baht, up 3.00 baht (1.89 percent)
INTUCH closed at 37.75 baht, down 2.25 baht (5.62 percent)
SCB closed at 118.00 baht, up 1.00 baht (0.85 percent)
KBANK closed at 135.50 baht, up 1.50 baht (1.12 percent)
PTT closed at 329.00 baht, down 3.00 baht (0.90 percent)
Shares continued to climb on both of Vietnam's stock exchanges Thursday as investor confidence improved, but market volumes and values remained low.
A second day of increases on the HCM City Stock Exchange reflected rising investor expectations that State Bank of Viet Nam Governor Nguyen Van Binh would soon follow through on his vow to rein in lending interest rates to around 19 per cent per year in the near future, said the head of Tan Viet Securities Co's analysis department, Le Dac An.
"In addition, though the market has experienced a long downturn, recent declines have not been steep, and many investors are beginning to believe that market has reached its lowest point," An said.
"However, any uptrend could be unstable as current capital inflows are short-term money that can be withdrawn from the market easily and quickly," he added. "Investor expectations need to be realised in order to reinforce their confidence."
On the HCM City Stock Exchange yesterday, the VN-Index surged by 2.4 per cent to close at 402.89 points. However, market value decreased 40 percent from Wednesday's session, totaling just VND488 billion (US$23.5 million) on a volume of 31 million shares.
Advancers outnumbered decliners by 169-62.
Blue chips continued to increase, with insurer Bao Viet Holdings (BVH), PetroVietnam Finance (PVF) and real estate developer Vincom (VIC) all rising by 5 per cent to the daily ceiling.
Saigon Securities Inc (SSI) was the most-active share on the southern exchange, with 3.75 million shares changing hands. It closed up 3.4 per cent to finish at VND18,500 per share.
On the Ha Noi Stock Exchange, the HNX-Index lost another 1.34 percent to close at 68.31 points, with gainers outpacing losers by three-to-one. However, trades slowed to 45.4 million shares, with total value of VND458.6 billion ($22 million).
Kim Long Securities (KLS) was again the most-active stock nationwide, with 7.9 million shares traded. It hit its ceiling price of VND11,000 a share.
Foreign investors concluded yesterday as net buyers on both exchanges, picking up over VND42 billion ($2 million) worth of shares.
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