ASEAN KEY DESTINATIONS
Asean Stock Watch- July 11
Jakarta Composite Index (JCI) closed up 1.63 percent at 4,003.69 points on Friday, having set a new all-time high during the day’s trading.
The index opened at 3,939.75, and breached the 4,000 psychological barrier at around 3 p.m., setting a new record high of 4,005.69 points.
The surge was attributed to a strong close on Wall Street overnight, with other Asian markets showing gains throughout the day. The Nikkei touched a 4-month high, and China reported closing a third straight weekly gain.
Leading the gains on the Indonesian bourse were Indo Tambangraya Megah (ITMG) closing up 5.36 percent to Rp 47,150 per share, and Astra International (ASII) which closed up 2.96 percent to Rp 67,800 per share.
The FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI) retracted 5.53 points to 1,589.21 at 10.15 a.m. this morning.
Turnover was at RM163.9mil involving the trading of 168 million shares. Leading the local bourse were the losers with 231 counters down, 165 up and 221 remained unchanged.
The top three gainers were Nestle that increased by 40 sen to RM47.70, Panamy climbed 28 sen to RM24.40 and KLK was up 16 sen RM22.82.
For the heavyweights, CIMB slid 7 sen to RM8.85, Axiata was down 3 sen to RM5.02 and Maxis remained unchanged at RM5.50.
According to HWANGDBS Vickers Research, the key FBM KLCI could see a pullback after closing at its intra-day high of 1,594.74 last Friday.
“Technically speaking, the benchmark index may slide towards its immediate support level of 1,575. Possibly making a dent on sentiment today is Wall Street's performance last Friday. Major U.S. equity indices slipped between 0.4 percent and 0.7 percent at the closing bell in reaction to disappointing unemployment data,” it said in a market preview report today.
Back home, it said investors will get an update on the index of industrial production (IPI) for May, which is due for release later today with one media poll projecting a year-on-year decline of 3.1 percent and the Jun plantation statistics (on production, inventory, exports) also scheduled to be out today.
“On the corporate front, stocks that may be of interest include Berjaya Corporation, after it had aborted the proposals to pay special dividends and make a restricted offer for sale of Cosway ICULS following its latest plan to privatize the Hong Konglisted Cosway,” it said.
Additionally, both SapuraCrest Petroleum and Kencana Petroleum securities were suspended effective 9 a.m. today pending a material announcement.
Coming off a record week, Philippine share prices may end their three-week winning run following worse-than-expected US employment numbers.
The weak jobs number, a key indicator of the US economy, could temper the optimism in the local equities market after posting all-time highs in the previous week.
“This could provide the fodder or the excuse for investors to book profits as trades open on Monday,” said Jun Calaycay of Accord Capital Equities Corporation. On Friday, the Dow Jones Industrial average lost 62.29 points or 0.49 percent to 12,657.20.
The Philippines’ main index posted a historic high of 4,439.61 on the back of an effective control of the European debt crisis, positive US macroeconomic data and management of Asian inflation.
But trading above the 4,400 mark may be a challenge for the index despite favorable domestic macroeconomic conditions.
“Moving forward, the market will have to find new motivations to keep on the buy-side of trades or hold positions rather than locking in profits immediately,” Calaycay said.
While inflation continues to increase in June, it is still within the full-year target band, increasing expectations that the Bangko Sentral ng Pilipinas may keep key interest rates unchanged for the second straight meeting.
“And although world crude oil prices have seemingly resumed a northern bias, the sustained strength of the domestic currency, alongside those in emerging economies, presents an offsetting force that may, in the end, tame inflationary pressures,” Calaycay said.
Full-year target is set at the 4,600 to 4,800 levels.
“The index is holding its own above the support of 4,328 as it continues to trend higher. Watch out for some issues that have not yet broken out but are near their resistances,” said Bonner Dytoc, senior instructor at Absolute Traders and Consulting Services Inc.
Singapore shares opened lower on Monday, with the benchmark Straits Times Index at 3,127.62 in early trade, down 0.75 percent, or 23.66 points.
Around 102.1 million shares exchanged hands.
Thai stocks opened down 7.32 points at the start of trade Monday morning. The Stock Exchange of Thailand (SET) main index opened at 1,081.14 points, down 0.67 percent from Friday’s close. The trade value was 2.54 billion baht.
The SET50 index opened at 757.10 points, down 6.25 points, or 0.82 percent, with a total trade value of 1.95 billion baht.
The SET100 index lost 12.99 points, or 0.78 percent, to stay at 1,650.12 points, with a total turnover of 2.24 billion baht.
The SETHD dropped 7.19 points, or 0.70 percent, to stand at 1,025.31 points, with a total turnover of 431.83 million baht
However, the Market for Alternative Investment (MAI or mai) index opened up 0.64 point, or 0.21 percent, to stand at 310.45 points, with total transaction value of 64.98 million baht.
The top five most active shares:
PTT stood at 333.00 baht, down 2.00 or 0.60 percent.
CPALL stood at 46.50 baht, down 1.25 or 2.62 percent.
SCB stood at 118.00 baht, down 2.00 or 1.67 percent.
LOXLEY stood at 3.00 baht, up 0.06 or 2.04 per cent.
TOP stood at 73.25 baht, down 1.00 or 1.35 percent.
On the HCM City Stock Exchange last week, the VN-Index concluded the week at 430.32 points, a net gain of 1.2 percent over the previous week, after reaching a low point during the week of 424.72.
The value of trades plummeted significantly, however, with the average daily value of trades reaching only VND424.4 billion (US$20.6 million), a 20-percent plunge from the previous week's level.
"Looking on the bright side, it is the very sluggish trades that may reverse the short-term trend, allowing the Index to rise even if there is just a small increase in demand during a session," said Au Viet Securities Co analysts, warning investors, however, to be aware of speculative cash flows in such a session.
The southern exchange's benchmark index had four sessions of advances last week, retreating during only one session.
The rebound mostly supported blue chips, with shares such as insurer Bao Viet Holdings (BVH), real estate developer Vincom (VIC) and food producer Masan (MSN) sustaining the VN-Index despite a lack of other supportive information.
"However, this week these shares may tumble after posting gains, which could result in another great plunge of the VN-Index," said FPT Securities analyst Nguyen Van Quy. "Whenever the VN-Index nears 430 points, there is always a surge in sell orders."
On the Ha Noi Stock Exchange last week, the HNX-Index declined for three out of five sessions. It nonetheless closed the week at 72.84 points, 0.12 percent higher than the previous Friday's close.
Market value sagged, however, dipping 26 percent from the previous week to an average daily value of VND241.7 billion ($11.7 million).
BIDV Securities Co analyst Tong Minh Tuan predicted that the HNX-Index would decline further in the coming week, only to recover once it fell as low as 70 points.
Earlier last week, the central bank cut interbank interest rates applicable to open market operations from 15 to 14 per cent.
"The move did not bring any new information but mainly acted as an orientation to a cautious but flexible tight monetary policy," said Tuan.
Following the decrease in the interbank interest rate, an additional VND4 trillion (US$194 million) was pumped into the nation's stock market last week.
"It can be inferred that the central bank is finding a new way to raise capital when the period for refinancing and rediscounts is coming to an end," Tuan said.
However, he also warned that any rallies would be short-lived and it would be difficult for the market to attract sustained cash flows.
In addition, as companies were about to announce their first-half earnings, investors preferred to keep their powder dry rather than buy in, commented Au Viet Securities Co analysts.
"With the common difficulties throughout the economy, firms will be unlikely to report profitable results," they said, predicting that investors would continue to keep a cautious eye on market movements.
Foreign investors were sellers on the HCM City last week, unloading a net of VND60 billion ($2.9 million) worth of shares, with Vinamilk (VNM) consituting the lion's share. Meanwhile, in Ha Noi, foreign investors were net buyers of a mere VND9 billion ($437,000 ) worth of shares.
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