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ASEAN STOCK WATCH Asean Affairs   30  December  2010

ASEAN Markets to Rally into 2011

Shayne Heffernan

ASEAN Markets will approach record highs at the close of 2011. Hot money and strong local growth will drive ASEAN markets and in turn support global growth.

Best buys today PTTEP, Sembcorp, Keppel, IRPC, Krakatau Steel

The Dow Jones industrial average was up 20.51 points, or 0.18 per cent, at 11,575.54. The Standard & Poor's 500 Index was up 0.98 point, or 0.08 per cent, at 1258.52. The Nasdaq Composite Index was down 4.39 points, or 0.16 per cent, at 2662.88.

Downbeat economic data kept the market in check. Consumer confidence unexpectedly deteriorated in December, hurt by increasing worries about the labour market, while the price of US single-family homes fell almost double the expected pace in October.

While the confidence data was weak, new sales data confirmed that US retailers are poised to show their best holiday season in three years, according to the International Council of Shopping Centers and Goldman Sachs.

The Stock Exchange of Thailand (SET) composite index on Wednesday gained 6.26 points or 0.61 per cent to close at 1,034.59 points. The market value was 22.65 billion baht, with 2.94 billion shares traded.

Ebeling Heffernan Strong Buy The energy conglomerate PTT Plc is diversifying into large-scale power projects, with plans to acquire stakes in two hydropower plants in a neighbouring country.

“PTT is now talking with two hydropower plant licence holders in Laos,” said Tevin Vongvanich, the company’s chief financial officer.

“The company wants to own about 25% of each project and expects to conclude at least one deal in next year’s first quarter.”

The move is aimed at tapping into growing demand for power in Thailand, he said, while declining to identify the plants.

However, an industry source said the plants in question were possibly the Xayaburi and Xe Nam Noi projects.

PTT’s board recently approved a five-year investment budget for 2011-15 worth 327 billion baht, with 46% earmarked for foreign operations such as coal mines, palm oil, floating liquefied natural gas, power generation and asset acquisition.

Of the total, almost 229 billion baht would be used for committed or approved projects and the rest for new investment opportunities.

Top five most active values were as follows;

TRUE closed at 7.20 baht, up by 0.20 baht or 2.86 per cent.

IRPC closed at 6.25 baht, down by 0.05 baht or 0.79 per cent.

SCB closed at 105.00 baht, up by 1.00 baht or 0.96 per cent.

BANPU closed at 788.00 baht, up by 8.00 baht or 1.03 per cent.

PTTEP closed at 167.00 baht, down by 2.00 baht or 1.18 per cent.

In Singapore the Straits Times Index gained 24.21 points, or 0.8 per cent, to end at 3,207.91. Volume totaled 1.37 billion shares valued at S$1.2 billion.

In the broader market, advancing issues led decliners 386 to 106.

Singapore Airlines climbed 22 cents to S$15.58, while OCBC gained 2 cents to S$9.96.

Property stocks continued to advance on hopes that Singapore’s strong economic growth will push up demand for residential and office space.

CapitaLand rose 7 cents to S$3.76, while City Development moved up 10 cents to S$12.78.

Rising crude oil prices continued to have a positive impact on rig builders. Keppel Corp gained 6 cents to S$11.04, while Sembcorp Marine added 6 cents to S$5.21.

In Kuala Lumpur the market traded within a range of 6.74 points between an intra-day high of 1526.93 and a low of 1520.19 during the session. Actively traded stocks include MAXBIZ, TEJARI, LIMAHSN, KNM-CE, COMPUGT, YTLPOWR-CB, TIMECOM, MUDAJAYA-CC, IRCB and IRCB-WA. Trading volume increased to 908.50 mil shares worth RM1393.73 mil as compared to Tuesday’s 822.88 mil shares worth RM1220.03 mil.

The Winners were GENTING (+18 sen to RM11.16), MAYBANK (+6 sen to RM8.55), AXIATA (+3 sen to RM4.74), SIME (+4 sen to RM8.81) and GENM (+5 sen to RM3.41).

The Losers were CIMB (-1 sen to RM8.54), GAM (-2 sen to RM3.80), PETCHEM (-1 sen to RM5.52), PLUS (-1 sen to RM4.58) and TENAGA (unchanged at RM8.36). Market breadth was positive with 468 gainers as compared to 294 losers.

In Jakarta the JCI advanced 39.22 points, or 1.1 percent, to close at 3,699.22. About 2.6 billion shares worth Rp 3.2 trillion ($355.2 million) changed hands.

Bakrie Sumatera Plantations advanced 2.7 percent to close at Rp 385 as rubber rose 1.1 percent to 412.2 yen per kilogram ($5,010 per metric ton) in Tokyo.

State-owned Krakatau Steel jumped 5.2 percent to Rp 1,210 as the March contract for steel rose as much as 0.6 percent to 69,440 yuan ($10,482) a ton in Shanghai.

Multifiling Mitra Indonesia soared 70 percent to Rp 340 on its trading debut. The document management firm raised Rp 51 billion from its IPO last week.

Medco Energi Internasional gained 0.8 percent to Rp 3,175 after crude rose as high as $91.49.

The rupiah climbed on Wednesday to 9,000 against the dollar from 9,015 the day before.

Analysts warned, however, that inflation may force the central bank to raise its key rate next year, making borrowing costlier.

“We have to watch out for inflation,” said Bambang Eko Joewono, of Bank UOB Buana. “The government will have to take steps to fight inflation next year. Liquidity is also thin as we approach the year-end.”


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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