ASEAN KEY DESTINATIONS
Asean Stock Watch- June 14
The Dow Jones Industrial closed up overnight by 1.06 points, or 0.01 percent at 11,952.97.
The S&P 500 gained 0.85 points, or 0.07 percent, to close at 1,271.83.
Among key S&P sectors, banks and telecoms finished higher, while energy tumbled.
The Nasdaq composite dropped 4.04 points, or 0.15 percent to end at 2,639.69.
Crude oil fell US$1.99, or 2 percent, to settle at US$97.30 a barrel.
Gold settled at USD 1,517.70 an ounce.
Indonesia’s benchmark stock index had its biggest decline in two weeks, trailing a regional decline, after US Federal Reserve officials’ comments raised concern about the pace of the global economic recovery.
The Jakarta Composite Index lost 17.13 points, or 0.5 percent, to 3,825.82, in its largest decline since May 23. Decliners outnumbered gainers 157 to 82. Trading activity was moderate, with 7.47 billion shares valued at Rp 6.34 trillion ($742 million) changing hands.
“The index was dragged down by negative sentiment from the region,” said Mastono Ali, an analyst at CIMB Indonesia.
Across the region, Australia’s S&P/ASX 200 Index lost 0.7 percent, South Korea’s Kospi Index retreated 0.8 percent and Hong Kong’s Hang Seng Index dropped 0.9 percent.
Federal Reserve chairman Ben Bernanke on Tuesday said the central bank should maintain record monetary stimulus to boost economic recovery. “Bernanke’s somber outlook combined with no hint of further quantitative easing being used as a policy response near-term have led to a negative tone in markets,” said Tim Schroeders, from global equities house Pengana Capital.
In the local market on Wednesday, Semen Gresik, the country’s biggest cement producer, fell 1.1 percent to Rp 9,300, while property developer Agung Podomoro fell 1.4 percent to Rp 350. Plantation company Astra Agro Lestari declined 0.4 percent to Rp 23,400.
For the long-term, however, Mastono sees prospects for further gains. As long as the index does not weaken to 3,770, its floor in last month’s trade, the prospects for an uptrend remain strong, he said. He forecast the index to rise to 4,370 this year.
Meanwhile, the rupiah was largely unchanged, quoted at 8,515 against the dollar on Wednesday afternoon.
Investors await Bank Indonesia’s monetary policy meeting today on whether to raise its key interest rate. Analysts expect no hike because inflation has been steady since March.
The FBM KLCI was marginally up in Tuesday's early trade, rising 0.07 percent or 1.09 points to 1,546.97 at 9.15am.
Among the gainers were Nestle (M) Bhd and DiGi.Com Bhd which gained 10 sen and eight sen respectively to RM48 and RM29 respectively.
Regional markets were mixed. Tokyo's Nikkei 225 fell 0.04 percent to 9,444.47 and Hong Kong's Hang Seng Index was down 0.78 percent to 22,332.88.
Shanghai's A index was down 0.01 percent to 2,700.20 while Taiwan's Taiex Index rose 0.32% to 8,740.66.
Seoul's Kospi Index gained 0.11 percent to 2,051.09, while Singapore's Straits Times Index slipped 0.16 percent to 3,054.11.
Nymex crude oil dropped 66 cents to US$96.64 per barrel. Spot gold rose US$1.75 to US$1,517.85 per ounce. The ringgit was quoted at 3.039 to the US dollar.
Philippine share prices and the peso fell on Monday amid signs that global economic recovery was stalling.
At the Philippine Stock Exchange, the composite index lost 48.04 points, or 1.14 percent to 4,171.54, falling below its mid-term support of 4,200. The broader all-shares index fell 33.25 points, or 1.12 percent to 2,946.62.
A total of 2.01 billion stocks worth P4.69 billion changed hands. Decliners routed advancers, 119 to 25, while 23 issued were unchanged.
“This level [4,200] has been holding since the second quarter started yet all external pressures finally caught up with the local market,” said Maria Arlysa Narciso of AB Capital Securities Inc.
“The local market was weighed down by the overseas market. The Dow’s decline on Friday somehow affected us,” said Astro del Castillo, managing director at First Grade Holdings.
On Friday, the Dow Jones Industrial Average plummeted 172.45 points, or 1.4 percent to 11,951.91, falling below the 12,000-mark for the first time since March. The Japanese government reported that core machinery orders surprisingly fell in April by 3.3 percent from the previous month, supporting the view that reconstruction work following the twin disaster that rocked the nation has yet to accelerate.
Local equities may face strong headwinds overseas, but the lack of fresh leads at home also prevented them from making strong moves, especially ahead of Thursday’s Bangko Sentral ng Pilipinas meeting.
“The local view on the economy is that another tightening could be expected in the BSP meeting this week,” said Narciso.
Closing below the psychological support of 4,200, the local market’s technical indicators suggest further weakness ahead.
“We’ll probably be moving sideways with a downward bias for the rest of the week. There’s no market moving news to lift the market,” del Castillo said. The next support for the market is at the 4,100 mark.
At the Philippine Dealing System, the local unit shed 5 centavos to close at 43.33 to the US dollar from 43.28 on Friday.
Analysts said recovery woes had “risk taking take a back seat even further, with the rest of the region having been bought up by their respective players.”
“Furthermore, the majors were sold down to establish new lows during Asia. Therefore, offers shown come afternoon were higher as the 43.37 level was instantly taken. But some players saw this as a good opportunity to sell down the dollar as they hedged their weekend flows and maximized gains,” an analyst said.
The dollar-peso pair opened at 43.35 and moved to a high of 43.40 and a low of 43.34.
Total trading volume reached $860.67 million from $706.42 million last Friday.
Some traders said the BSP was spotted in the market protecting the 43.32 level and was believed to have sold between $100 million and $200 million.
Traders expect Asian currencies to have a bias on the bid within the week given the volatility of the euro and a bounce of the US dollar across the board.
They expect the pair to trade within the 43 to 43.60 range for the rest of week.
Monetary authorities said the peso has remained competitive owing to the sustained inflows of remittances, portfolio investments, and foreign direct investments.
However, the reemergence of concerns about the strength of the global economy’s growth due to external factors, especially from the US, have tempered the peso’s further appreciation, the BSP said.
The inter-agency Development and Budget Coordination Committee in January revised upward its foreign exchange rate assumptions to average at 42 to 45 for 2011 and 2012 from an earlier assumption of 45 to 47.
Singapore shares opened lower on Tuesday, with the benchmark Straits Times Index at 3,054.51 in early trade, down 0.14 percent, or 4.53 points.
Around 43.7 million shares exchanged hands.
The Stock Exchange of Thailand main index went down 4.84 points or 0.47 percent to close at 1,015.53 points at the end of trading session on Monday afternoon. The trade value was 17.88 billion baht.
The SET50 index ended at 708.76 points, down 2.97 points or 0.42 percent, with a total trade value of 11.58 billion baht.
The SET100 index fell 7.70 points or 0.50 percent to stand at 1,543.65 points, with a total turnover of 14.24 billion baht.
The MAI index went up 1.23 points or 0.42 percent to close at 292.64 points, with total transaction value of 521.41 million baht.
Top five most active values were as follows;
SCB closed at 103.50 baht, down 2.50 baht (2.36 percent)
PTT closed at 331.00 baht, down 3.00 baht (0.90 percent)
BANPU closed at 712.00 baht, down 8.00 baht (1.11 percent)
KBANK closed at 111.00 baht, down 0.50 baht (0.45 percent)
THAI closed at 28.50 baht, down 1.25 baht (4.20 percent)
Investment continued to flow into the Hanoi Stock Exchange yesterday, lifting the HNX-Index by over 2.24 percent by the end of the session to a close of 80.87 points, while slumping blue chips on the HCM City Stock Exchange dragged the VN-Index down by over half-a-percent.
The value and volume of trades in Hanoi continued to climb from previous sessions, reaching VND749.6 billion (US$36.4 million) on a volume of nearly 70 million shares. Advancers outnumbered decliners by 258-47.
Trading was active in shares viewed as attractive to speculative investors, including Kim Long Securities Co (KLS), which became the most-active share nationwide with nearly 6.6 million shares changing hands. Trading was also heavy in shares of VNDirect Securities (VND) and PetroVietnam Construction (PVX).
On the HCM City Stock Exchange, value soared by 33 percent from Friday's session to VND887.3 billion ($43 million) and volume rose by 40 percent to 57.6 million shares. While 76 codes hit their ceiling prices, gaining the daily limit of 5 per cent, most of these were penny shares or mid caps without a heavy influence on calculation of the VN-Index.
Blue chips retreated, meanwhile, with seven of the 10 leading shares by capitalisation declining, including insurer Bao Viet Holdings (BVH), down 5 percent; PetroVietnam Finance (PVF), down 3.6 percent; food processing conglomerate Masan Group (MSN), down 3 per cent; Vietinbank (CTG), down 2.5 per cent; and Phu My Fertilisers (DPM), developer Hoang Anh Gia Lai Co (HAG) and steelmaker Hoa Phat Group (HPG) all off by less than 1 percent.
Of these leading shares, only those of real estate developer Vincom (VIC) advanced to the ceiling price.
Shares of Saigon Securities Inc (SSI), the most-active share on the HCM City market, with 2.46 million traded, closed up 1.5 percent to VND20,700 (about $1) per share.
Analysts of PetroVietnam Securities Co said trading began strongly but that demand weakened as the VN-Index was headed to 460 points, the landmark it failed to gain last week.
"After two successive weeks of increases, many shares have almost regained their values before the downtrend," they said.
With little good economic news, there remained no solid basis for a sustainable recovery of the market, they added.
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