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ASEAN STOCK WATCH Asean Affairs   29  December  2010

ASEAN to lead World Markets Higher

Shayne Heffernan

ASEAN Markets are set to lead the world higher today, US traded flat after housing data showed continued doubt. In Asia, China is still showing strong growth, Despite the bubble news filling the press, the reality is China is still booming.

Industrial companies in China have seen profits rise 49.4 per cent in the 11 months to November 30, compared with the corresponding period last year, putting pressure on the central bank to raise interest rates simply to manage their economy.

Net income climbed to 3.88 trillion yuan ($A583 billion), according to China’s statistics bureau.

Rising earnings at companies such as Jiangxi Wannianqing Cement may support corporate investment, even as the government eases state spending and reverses stimulus policies.

The People’s Bank of China announced a 0.25 percentage-point increase in lending and deposit rates on Christmas Day in its second move since mid-October to tame inflation. JPMorgan Chase has predicted more monetary tightening in 2011.

In Singapore the Straits Times Index closed up 0.8% at 3,183.70 as of the close of trading. Thirteen stocks advanced for each that fell in the benchmark equity index of 30 companies.

Straits Times Index trades at an average 15.5 times estimated earnings, compared with about 17.4 times at the beginning of the year, this still allows for a good deal of growth.

Ebeling Heffernan strong buy Palm-oil producers First Resources Ltd, an Indonesian palm plantation company, advanced 2 percent to S$1.56. Golden Agri-Resources Ltd. (GGR SP), the world’s second-biggest palm-oil producer, rose 2.6 percent to 79.5 Singapore cents. Indofood Agri Resources Ltd. (IFAR SP), the palm-oil unit of Indonesia’s biggest noodle maker, climbed 4 percent to S$2.83.

Crude palm-oil futures for March delivery jumped 2.5 percent in Kuala Lumpur yesterday.

Ebeling Heffernan Strong Buy Keppel Corp. , the world’s biggest builder of oil rigs, climbed 0.9 percent to S$10.98. The company said its Keppel Offshore & Marine Ltd. unit won new contracts totaling S$240 million ($185 million) to upgrade a floating production storage and offloading vessel, convert a livestock carrier and build a diving support vessel.

The Stock Exchange of Thailand (SET) composite index gained 8.87 points or 0.87 per cent to close at 1,028.33 points on Wednesday. The trade value was 17.71 billion baht, with 2.88 billion shares traded.

The Fiscal Policy Office has raised its projection for gross domestic product growth for 2010 to 7.8 per cent year-on-year.

The FPO in September predicted that this year’s economy would grow 7.5 per cent.

FPO director-general Naris Chaiyasut said on Tuesday the new economic forecast was high, considering that the economy contracted 2.3 per cent last year.

Mr Naris said the increase was attributed to improved exports, higher consumption, investment and higher prices of agricultural products.

This year’s headline inflation was expected to stay at 3.3 per cent while the core inflation should stand at 0.9 per cent.

The country should have a current account balance of 4.4 per cent of GDP.

The import value for this year should increase 37.5 per cent while the export value should rise 28.3 per cent, Mr Naris said.

The GDP for the fourth quarter of this year should grow 3.5 per cent year-on-year.

The GDP growth for next year was predicted at 4.5 per cent, he said.

Top five most active values were as follows;

IRPC closed at 6.30 baht, up 0.50 or 8.62 per cent.

TRUE closed at 7.00 baht, up 0.45 or 6.87 per cent.

TMB closed at 2.36 baht, up 0.06 or 2.61 per cent.

CPF closed at 24.70 baht, up 0.20 or 0.82 per cent.

TOP closed at 77.25 baht, up 2.25 or 3.00 per cent.

In Kuala Lumpur the index surged 5.72 points on Tuesday.

The market traded within a range of 16.44 points between an intra-day high of 1525.99 and a low of 1509.55 during the session.

Most Active TEJARI, IRCB-WA, HUBLINE, PETRA-WA, PETRA-WA, IRCB-WA, COMPUGT, BJCORP, PANTECH-LA and TIMECOM. Trading volume increased to 822.88 mil shares worth RM1220.03 mil as compared to Monday’s 773.21 mil shares worth RM868.92 mil.

The Winners PBBANK (+16 sen to RM12.96), GENTING (+18 sen to RM10.98), KLK (+44 sen to RM22.64), PPB (+34 sen to RM17.10) and SIME (+4 sen to RM8.77).

The Losers were AXIATA (-2 sen to RM4.71), CIMB (-2 sen to RM8.55), MMCCORP (-3 sen to RM2.80), TM (-1 sen to RM3.50) and PLUS (-1 sen to RM4.59).

Market breadth was positive with 390 gainers as compared to 370 losers.

The Finance Index increased 0.25% to 13840.5 points, the Properties Index up 0.34% to 1016.51 points and the Plantation Index rose 0.05% to 8032.98 points.

In Jakarta the JCI advanced for the second day, rising 34.73 points, or 1 percent, to 3,659.99. About 3.5 billion shares worth Rp 3.2 trillion ($355.2 million) were traded, while gainers outpaced decliners 140 to 60.

Astra Agro Lestari, Indonesia’s biggest listed plantation company, gained 0.6 percent to Rp 25,000, while Perusahaan Perkebunan London Sumatra Indonesia, the country’s second largest, added 2.6 percent to Rp 12,350. Palm oil futures rose as much as 1 percent to 3,792 ringgit ($1,226) per metric ton in Kuala Lumpur on Tuesday.

Aneka Tambang, Indonesian’s second-biggest gold and nickel producer, advanced 3.1 percent to Rp 2,475. Immediate-delivery gold increased as much as 0.6 percent to $1,391.95 an ounce in Tokyo on Tuesday.

Bank Rakyat Indonesia, the nation’s second-largest bank by assets, climbed 3.9 percent to Rp 10,600. BRI was one of four lenders who provided a combined $116 million in loans to state utility company Perusahaan Listrik Negara on Monday.

The rupiah strengthened, rising from 9,035 to trade at 9,015 to the US dollar on Tuesday. The currency rose on optimism that the government would take firm measures to combat inflation.

Philippines – Local stocks were a tad lower on Tuesday on jitters over a monetary tightening in China over the long holiday break.

The main-share Philippine Stock Exchange index gave up 2.05 points or 0.49 percent to 4,163.99.

Dealers said this was a kneejerk reaction to China's decision to raise by another 25 basis points its target lending rate and deposit rate in order to curb inflationary pressures.


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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