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ASEAN STOCK WATCH Asean Affairs   21  July  2011

Asean Stock Watch- July 21



Overnight, the Dow Jones Industrial Average soared 202.11 points, or 1.63 percent, to 12,587.27 on strong corporate earnings of IBM and Coca-Cola. Sentiment was positive after US President Barack Obama endorsed a debt deal to cut the deficit by more than $4 trillion.


Indonesia’s benchmark stock index rose to a record high on Wednesday, erasing losses from the previous trading day, in anticipation of a possible credit upgrade by Fitch Ratings to investment grade.

The Jakarta Composite Index gained 27.22 points, or 0.7 percent, to close at 4,050.63, after dropping 0.2 percent on Tuesday. Nine billion shares valued at Rp 6.42 trillion ($750 million) changed hands on the Indonesia Stock Exchange. Gainers led decliners 162 to 71. Foreign investors bought Rp 7 billion more in shares than they sold.

On Wednesday a Bloomberg report cited an executive at Fitch Ratings saying Indonesia was likely to have its sovereign credit rating upgraded ahead of the Philippines because of “stronger growth prospects.”

Both countries’ ratings are one level below investment grade. A ratings increase would boost the credit worthiness of Indonesia and encourage investment.

“Its [Fitch’s] rating statement influenced the market’s movement,” said Cece Ridwanulloh, an analyst at brokerage Ekokapital Sekuritas in Jakarta.

“Economic growth is robust, and it is a good sign for a possible upgrade. Hopefully, sometime in the third quarter we will have the upgrade.”

Property stocks led gains. Lippo Karawaci, Indonesia’s largest listed property developer by assets, surged 7.3 percent to Rp 740. The Lippo group is affiliated with the Jakarta Globe. Alam Sutera Realty leapt 6.6 percent to Rp 405, and Ciputra Development jumped 7.2 percent to Rp 520.

Property developers’ sales may be higher in the first half compared to a year earlier because steady interest rates had encouraged consumers to purchase land and homes, Cece said.

Telekomunikasi Indonesia, the country’s biggest phone company, rose 0.7 percent to Rp 7,100. Local reports suggested Telekomunikasi’s unit, Dayamitra Telekomunikasi, planned to boost its number of telecommunication towers to 3,000 units from 566 units currently.

Coal-mining companies rose in sympathy with the gain in crude oil, which climbed around 2 percent to nearly $98 a barrel in New York.

Bumi Resources, Indonesia’s biggest coal miner, rose 0.8 percent to Rp 3,075. Coal miner Borneo Lumbung Energy & Metals rose 2 percent to Rp 1,500.

The rupiah gained 0.2 percent against the dollar to Rp 8,530 at Wednesday’s close.


The local bourse started Thursday on a stronger footing with buying interest in blue-chip counters and selected plantation stocks. The the FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI) added 0.85 points at 9.50am to 1,563.44.

The benchmark index opened 1.04 points higher at 1,563.63. Losers led gainers with 158 to 177 while 194 counters were unchanged. Turnover stood at 279.8 million shares worth RM670.5mil. A dealer said broadly sideways performance was only to be anticipated in the absence strong leads, locally or abroad.

“Indicators remain positive and this may give investors the excuse to lock in profits. If there is any incentives to buy, it would be the positive announcement to be expected during this earnings season,” a dealer said.

HwangDBS Vickers Research said even though Wall Street was marginally weaker last night (as its key bellwethers were down between 0.1% and 0.4%), the local bourse could draw strength from domestic events today.

“We expect the benchmark FBM KLCI to show a slight positive bias ahead. Hogging the limelight will be oil and gas service provider Bumi Armada, which will be making its debut listing this morning.

“Meanwhile, Genting group of companies may also attract attention after a local business daily reported that the group and its Vietnamese partner have been granted government's approval to develop a US$4bil recreational gaming resort project in Thang Binh district, Vietnam,” the research house said.

HwangDBS said financial result announcements would come under watch too. Tenaga Nasional Bhd and British American Tobacco (BAT) are scheduled to reveal their latest quarterly earnings report cards after market hours this evening.

Bumi Armada Bhd debuts at RM3.65, up 62 sen against its IPO price of RM3.03. The counter was both the most actively traded stock and top gainer.

Other gainers included BAT, Nestle (M) Bhd and PPB Group. Among banks, CIMB Group rose 2 sen to RM8.55, Public Bank Bhd was 2 sen lower at RM13.36 while Malayan Banking Bhd fell 1 sen to RM8.83


The Philippine stock market on Wednesday continued to sizzle and hit a new record above the 4,500-mark, driven by third liners and hopes of a resolution to the debt-ceiling standoff in the US.

At the Philippine Stock Exchange, the composite index added 21.39 points, or 0.48 percent to an all-time high of 4,507.04, surpassing its previous record of 4,485.65 on Tuesday.

The broader all-shares index added 20.36 points, or 0.66 percent to 3,124.09.

A total of 10.29 billion shares worth P6.74 billion changed hands.

“While investors were cautious over uncertainties in global markets, their interest shifted towards small caps for specific plays,” said Maria Arlysa Narciso of AB Capital Securities Inc.

The PSE index closed at a fresh record for the fourth consecutive day, extending its year-to-date gains to 305.90 points or 7.28 percent “The stock market’s resilience has echoed the positive sentiment in Asian and US shares. We continue to be optimistic that positive economic fundamentals and favorable corporate earnings towards the end of the year will further boost market confidence,” said Hans Sicat, PSE president and chief executive officer.

“Any potential move to keep the US economy from a debt default is welcome news to most markets,” said Narciso.

The mining and oil counter continued to impress, led by Lepanto Consolidated Mining, Atlas Consolidated Mining and Development and Semirara Mining, as investors flocked to metals for safety given the debt woes of the major economies.

The market will undergo a test of strength on Thursday after being lifted mostly by third liners. “If sentiments abroad turn better particularly a successful debt deal in the US, this development can be used to keep the index above 4,500. But if weakness persists, we can likely see the index move back lower until it finds a firm and convincing reason for a strong run,” said Narciso.

The peso also rose on Wednesday, backed by earnings reports from US firms and optimism that both US and European lawmakers may be close to working out their debt problems.

At the Philippine Dealing System, the local unit closed at 42.710 against the US dollar, up 12 centavos from Tuesday’s 42.83 finish.

The dollar-peso pair opened at 42.80 and moved to a high of 42.82 and a low of 42.710.

Total trading volume reached $983.70 million from $922.215 million the previous trading day.

The currency pair is expected to trade within a 42.50 to 43.30 range for the week.


Singapore shares opened lower on Thursday, with the benchmark Straits Times Index at 3,120.15 in early trade, down 0.20 percent, or 6.38 points.

Around 67.1 million shares exchanged hands.


The Stock Exchange of Thailand main index went up 4.60 points or 0.42 percent to close at 1,101.37 points at the end of trading session on Wednesday Afternoon. The trade value was 37.12 billion baht, with 4.5 billion shares traded.

The SET50 index ended at 771.99 points, up 3.04 points or 0.40 percent, with a total trade value of 26.18 billion baht.

The SET100 index rose 7.13 points or 0.43 percent to stand at 1,681.94 points, with a total turnover of 30.77 billion baht.

The SETHD index went up 15.57 points or 1.51 percent to stand at 1,048.03 points, with total trade value of 11.23 billion baht.

The MAI index went up 2.22 points or 0.72 percent to close at 311.82 points, with total transaction value of 1.02 billion baht.

Top five most active values were as follows;

BBL closed at 169.00 baht, up 2.00 baht (1.20 percent)

PTT closed at 346.00 baht, up 6.00 baht (1.76 percent)

SCB closed at 118.50 baht down 2.50 baht (2.07 percent)

KBANK closed at 133.50 baht, down 2.50 baht (1.84 percent)

DTAC closed at 61.75 baht, up 3.50 baht (6.01 percent)


Benchmark indices were back in positive territory Wednesday, following Tuesday's session during which the volume of trades dropped to the lowest level in two years.

On the HCM City Stock Exchange, the VN-Index closed at 416.77, a gain of 1.6 per cent, while the value of trades spiked by 46 percent over the previous session to VND400.6 billion (US$19.4 million). Volume was 21.4 million shares, an increase of 28 percent.

Advancers outnumbered decliners during yesterday's session by 146-70. Inflation figures for July were announced yesterday for the nation's two largest cities, with year-on-year inflation skyrocketing to 21.5 percent in Ha Noi and 17.9 percent in HCM City.

"However, this increase was not unexpected to investors," said a securities analyst in Ha Noi who asked to remain unnamed.

Yesterday's rebound could have been caused by speculation in low-priced shares, while a number of analysts believed that the sharp rise in gold prices in the past few days had made some investors think twice about investing in gold, turning their back toward the stock market.

The gains to be realised in gold trading were not really remarkable compared to other investment channels, commented Trang An Securities Co analyst Doan Phuc Ngan.

Among the 10 leading shares by capitalisation, eight posted gains, with Vietinbank (CTG), software giant FPT, property developer Hoang Anh Gia Lai (HAG) and PetroVietnam Finance (PVF) all hitting their ceiling prices.

Bac Giang Exploitable Minerals Co (BGM), which listed shares on the HCM City bourse a month ago, was the most-active share, with nearly 1.6 million traded – although it plunged to its floor price.

Ngan said the surge in this newly-listed share's volume might have reflected an unsuccessful effort to save it from plunging.

On the Ha Noi Stock Exchange yesterday, the HNX-Index also rose by 1.3 percent to close at 71.69 points. Trading was mixed, with the value of trades reaching VND250.7 billion ($12.2 million), an increase of 30.3 percent over the previous day, on a volume of 22.3 million shares.

Kim Long Securities Co (KLS) was the most-active share, with 3.3 million shares changing hands, although trades in VN Direct Securities Co (VND) were also brisk, with 2.2 million shares traded. Ngan noted that yesterday's rebound was not stable, since the combined market value of both exchanges remained low.

"It's difficult to forecast the long-term trend of the indices, but I think we will experience both declines and advances during the rest of this week," he said. "The short-term trend is therefore horizontal."

Foreign investors were net sellers in HCM City, unloading a net of VND34.5 billion ($1.7 million) worth of shares, while ending up as net buyers on the northern market by a net of VND959 million ($46,500).


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