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ASEAN STOCK WATCH Asean Affairs   25 January 2011

ASEAN will rally hard today, buy early in Thailand, Indonesia especially

Shayne Heffernan

The Dow Jones industrial average gained 88.06 points, or 0.74 percent, to 11,959.90. The Standard & Poor's 500 rose 6.71 points, or 0.52 percent, to 1290.06. The Nasdaq Composite added 25.61 points, or 0.95 percent, to 2715.15.

The S&P materials sector advanced 1.4 pe cent. Copper prices rose as concerns about a decrease in Chinese demand were replaced by worries over supply constraints..

In Jakarta, the JCI lost 33.48 points, or 0.99 percent, to close at 3,346.06 on Monday. About 2.5 billion shares worth Rp 4.1 trillion ($450 million) changed hands. Decliners led gainers 152 to 67. The index lost 5.6 percent last week.

HM Sampoerna, the country’s largest cigarette maker, slipped 2.6 percent to Rp 25,900 and Gudang Garam, Indonesia’s second-largest tobacco company, fell 1.9 percent to Rp 35,500. Investors continued to worry that rising prices of consumer goods would reduce demand for those products.

United Tractors, Indonesia’s biggest heavy equipment seller, declined 1.2 percent to Rp 20,200. Shares dropped after the company said sales fell to 313 units in December, down 25 percent from the previous month.

The rupiah weakened slightly to trade at 9,068 to the US dollar as the market closed, compared to its Friday close of 9,057.

The rupiah is expected to remain flat on speculation that the central bank will keep the currency stable to help curb price pressures.

Bank Indonesia Deputy Government Budi Mulya said on Monday that the rupiah was trending toward strength and would remain stable.

Even if there is inflationary pressure coming from food prices, he said, Indonesia’s fundamentals are still strong.

In Manila the Philippine Stock Exchange index dived again to close at 3,902.71, 1.22 percent or 48.33 points lower. The broader all-share index was also down by 1.37 percent or 41.27 points to 2,952.31. Heavyweight Philippine Long Distance Telephone Co., Metropolitan Bank and Trust Co., Aboitiz Power Corp. and Ayala Corp. were among the most actively traded issues.

The Philippine government is scheduled to report the actual 2010 economic growth on January 31. Government officials expect the GDP could have expanded 6.8 percent to 7.3 percent in 2010.

Trading volume reached 1.33 billion shares worth P4.6 billion ($103 million) with 113 issues diving and only 22 stocks advancing. A total of 37 shares closed flat. All counters closed lower, led by the holding firm sector which tumbled by 2.38 percent.

The selling barrage continued as investors overreact on the threat of higher inflation in the country. The local central bank said latest data points to an upward bias in inflation this year. This made market participants consider the effects of a sooner- than-expected key policy rate adjustment by the central bank on stock valuation.

Although the level of inflation this year will not curtail a healthy level of liquidity in the financial system, such development comes alongside the monetary policy tightening in the Asian region led by China.

In Kuala Lumpur the KLCI index lost 4.46 points or 0.29 percent on Monday. The Finance Index increased 0.17% to 14040.44 points, the Properties Index dropped 0.74 percent to 1089.06 points and the Plantation Index down 1.15 percent to 7998.23 points.


The Losers were PETCHEM (-15 sen to RM6.05), PBBANK (-8 sen to RM13.34), GENM (-9 sen to RM3.31), KLK (-46 sen to RM21.88) and IOICORP (-4 sen to RM5.85).

The Winners were CIMB (+10 sen to RM8.44), AMMB (+10 sen to RM6.86), PLUS (+4 sen to RM4.48), PETGAS (+6 sen to RM11.26) and PETDAG (+2 sen to RM12.14). Market breadth was negative with 258 gainers as compared to 548 losers.

Trading volume decreased to 1833.50 mil shares worth RM2209.44 mil as compared to Friday’s 1890.67 mil shares worth RM3159.13 mil. The market traded within a range of 11.47 points between an intra-day high of 1550.95 and a low of 1539.48

In Singapore shares closed 0.04 percent higher on Monday, with the benchmark Straits Times Index at 3185.76, up 0.04 percent, or 1.16 points.

Asian equities have sold off since the start of 2011 and that fall gained momentum this week on fears over inflation is not a rush by investors to exit emerging markets, but a paring of exposure to economies seen with most to lose.

Sellers have targeted stocks in India, China and Indonesia, worried authorities are being too slow to tighten policy in these fast-emerging economies producing much of the world’s economic growth.

However, the funds are not necessarily leaving the region, a relief to policymakers who worry that last’s year record inflows could become outflows that destabilise their economies.

Markets in Malaysia and South Korea, where the central banks are seen to have a better handle on inflation following rates rises, are strong. Indeed, just this week Korea’s stock market hit a record high.

About 1.5 billion shares exchanged hands.

Losers beat gainers 273 to 170.

Banpu, PTT, PTTEP, IRPC are all strong buys today after a big drop on the SET overnight.

The Stock Exchange of Thailand (SET) composite index on Monday plunged 42.89 points or 4.26 per cent to close at 963.68 points. The market value was 37.40 billion baht, with 5.38 billion shares traded.

The baht yesterday opened at 30.65 baht a dollar and traded at 30.95 baht at 6.30 pm, depreciating by 3 percent from 30.05 baht at the beginning this year.

SET president Charamporn Jotikasthira said the sharp fall of the Thai stock market yesterday was in line with those in the same region including the Philippines and Indonesia.

He believes foreign investors have taken profits after the baht has recently depreciated. The investors should have gained by 50 percent over the past year in dollar terms.

Foreign investors were the net sellers of four billion baht, while institutional investors were net sellers of 2.57 billion baht and proprietary investors were net sellers of 44.32 million baht, leaving individual investors the only party buying the stocks with net worth of 6.7 billion baht.

Top five most active values were as follows;

BANPU closed at 748.00 baht, down by 36.00 or 4.59 percent.

PTT closed at 321.00 baht, down by 18.00 or 5.31 percent.

SCB closed at 95.50 baht, down by 2.00 or 2.05 percent.

IRPC closed at 5.25 baht, down by 0.35 or 6.25 percent.

PTTCH closed at 140.00 baht, down by 6.50 or 4.44 percent.


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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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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