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ASEAN STOCK WATCH Asean Affairs   10  May  2011

Asean Stock Watch-May 10



The global forecast for the Asian markets is cautiously optimistic thanks to a solid rebound in the commodities markets following last week's heavy selling. The upside may be limited, however, by renewed debt concerns from Greece. The European markets finished lower and the U.S. bourses were higher, and the Asian markets generally figure to tick slightly higher.


The Indonesian stock market has finished lower now in back-to-back sessions, retreating more than 30 points or 0.8 percent along the way. The Jakarta Composite Index finished just above the 3,785-point plateau, and now analysts are forecasting a modest recovery at the opening of trade on Tuesday.

Indonesia’s rupiah advanced for a third day on optimism economic growth in Southeast Asia’s biggest economy is attracting funds.

The JCI finished modestly lower on Monday following consolidation from the energy companies and resource stocks.

For the day, the index fell 13.10 or 0.34 percent to finish at 3,785.45 after trading between 3,777.51 and 3,803.5

The Indonesian currency has strengthened 0.2 percent so far this month as official data showed last week gross domestic product rose 6.5 percent in the first quarter from a year earlier after having increased 6.89 percent in the previous three months. Overseas investors bought $171 million more Indonesian stocks than they sold this month through yesterday, boosting net purchases this year to $1.9 billion, according to exchange data.


Markets were mostly up on Tuesday as commodity prices recovered from last week's slump and overshadowed concerns over Greece's finances.

Trading in Asia was mixed as investors in Japan were spooked by renewed worries over electricity shortages after Prime Minister Naoto Kan called for the Hamaoka nuclear power plant, located near an earthquake fault line southwest of Tokyo, to suspend its operations.

Over in the US, the market was still getting a boost from Friday's government nonfarm payrolls report, which showed that employers added 244,000 jobs last month.

Concerns over Greece's debt burden continued in Europe after ratings agency Standard & Poor's cut Greece's long-term credit rating to single-B from double-B-minus.

S&P said the downgrade reflects the increasing likelihood that Greece's official creditors, led by the German government, may soon force private bondholders to accept an extension on Greek debt repayments coming due in the next few years.

At 10.30am, the FBM KLCI was up 2.3 points to 1,521.71. There were a total of 200 gainers and 198 losers with 258 stocks unchanged.

Tokyo's Nikkei 225 was down 0.24 percent to 9,771.11 and Hong Kong's Hang Seng Index was up 0.76% to 23,336.

Shanghai's A index was up 0.03 percent to 2,873.42 while Taiwan's Taiex Index was up 0.08% to 9,042.66.

Seoul's Kospi Index was down 0.39 percent to 2,139.17, with Singapore's Straits Times Index was up 0.17% to 3,142.4.

Nymex crude oil was down US$1.46 to US$101.09 per barrel.

Spot gold was up US$6.50 to US$1,509.70 per ounce.

The Ringgit was traded at 2.985 to the US dollar.


Philippine share prices on Monday broke a four-day decline, inspired by the overnight gains on Wall Street because of better-than-expected employment figures.

At the Philippine Stock Exchange, the composite index gained 38.08 points, or 0.9 percent to 4,257.15, while the broader all-shares index rose 25.22 points, or 0.85 percent to 2,984.43. Market breadth was negative as decliners beat advancers, 72 to 70, while 41 stocks were unchanged. A total of 8.67 billion stocks worth P5.65 billion changed hands.

“An expected flow of positive numbers from the US which likewise pulled up most regional markets, fueled investors’ appetite for risk,” said Jun Calaycay of Accord Capital Equities Corp. On Friday, the Dow Jones industrial average rose 54.57 points, or 0.4 percent to close at 12,638.74 following a better-than-expected jobs data.

The US economy has been posting mixed figures, mostly positive, broken by disappointing numbers from the housing and jobs sector.

“Nevertheless, the overall bias, at least sentiment-wise, is that these are just the usual potholes in the road to recovery,” Calaycay said.

Earnings are expected to take a back seat in favor of US economic indicators set to be released this week such as international trade, producer price index, retail sales, jobless claims and consumer prices.

Shares in Philippine Long Distance Telephone Co., JG Summit Holdings Inc. and the Manila Electric Co. led the market’s advance on Monday.

The market is in a consolidation mode with an immediate resistance level of 4,250. “The driver that will make or break the support and resistance levels will be first quarter earnings results,” said AB Capital Securities Inc.

At the Philippine Dealing System, the peso strengthened, closing at P42.930 to the US dollar on Monday from P43.080 last Friday.

In a research note, Metropolitan Bank and Trust Co. said the local currency is expected to trade within 42.750 to 43.400 this week.


Singapore's stock market rose sharply on Monday after the ruling People's Action Party (PAP) was returned to power decisively, removing uncertainty that had crept into the market.

Investors took heart from the PAP's comfortable victory even though its vote share of 60.1 per cent was a historic low, and the opposition won six seats, including a first-ever Group Representation Constituency (GRC).

In the lead-up to Polling Day, investors had feared a worse showing by the PAP and sold off some of their holdings in last week's falls. With this uncertainty gone and with the ruling party still holding an overwhelming majority in Parliament, the market heaved a sigh of relief and cash started flowing back into stocks.

The benchmark Straits Times Index (STI) jumped 1.21 per cent, or 37.42 points, to close at 3,136.94.

The STI outperformed most other regional bourses, including Hong Kong's Hang Seng Index, which rose by 0.76 percent, and the 0.3 percent rise in Shanghai stocks. Taiwan rose by 0.65 per cent while Kuala Lumpur added 0.26 percent.

Better-than-expected United States jobs data boosted regional sentiment.


Thai stocks opened up 3.79 points at the start of trade Tuesday morning. The Stock Exchange of Thailand (SET) main index opened at 1,076.26 points, up 0.35 percent from Monday’s close. The trade value was 3.55 billion baht.

The SET100 index gained 6.07 points, or 0.37 percent, to stay at 1,653.42 points, with a total turnover of 1.84 billion baht.

The SET50 index opened at 758.10 points, up 2.95 points, or 0.39 per cent, with a total trade value of 1.13 billion baht.

The Market for Alternative Investment (MAI or mai) index opened up 0.57 point, or 0.20 per- cent, to stand at 287.62 points, with total transaction value of 18.90 million baht.

The top five most active shares:

LHBANK stood at 1.90 baht, up 1.90 percent

JAS stood at 3.20 baht, up 0.12 or 3.90 percent.

PTTCH stood at 156.00 baht.

PTT stood at 361.00 baht, up 3.00 or 0.84 percent.

AJ stood at 26.50 baht, up 2.50 or 10.42 percent.

The SET rebounded more than 2 percent on Monday, but the outflow of foreign funds is expected to continue this week as the baht has been depreciating for the past three days.

The SET index closed at 1,072.47 points, up by 21.62 points or 2.06 percent, in trade worth 31.8 billion baht.

Foreign investors and institutional investors were net buyers of 1.2 billion baht and 1.92 billion respectively. Proprietary and individual investors were net sellers of 232.6 million baht and 2.9 billion respectively.

The SET's rebound after a sharp fall last week should be short-term as several negative factors are pressuring the market this week.

These factors include the volatility of commodity prices, the strengthening US currency, profit-taking and tomorrow’s lower house dissolution that paves the way for a new general election on July 3.

Last week, foreign investors were net sellers of 6 billion baht while the baht depreciated more than 1.2 percent.

According to fund flow trends for the past 20 years, the outflow will continue for the next few days, she said.

Asia Plus recommends investing in small and medium-sized stocks with a lower price-to-earnings ratio.

SCB Securities expects the market to be more volatile in the second quarter because of the national election. It predicts the SET will likely touch 1,100 points before the election and drop to 1,000 points after the election.

Sectors that are expected to outperform the market are commerce and media, with 20-30 billion baht spent on the latter during the election.

Observers say that traditionally the SET rises 2-6 percent during the election. They expect the SET to stay at 1,070 to 1,100 points for this quarter they said. After the election, they expect the market to be volatile due to uncertainties at home and abroad.


The VN-Index slumped at the opening of yesterday's session on the HCM City Stock Exchange but ended on a high, while shares in Hanoi built on early gains to shrug off last Friday's pullback. Although the weak performance of some significant shares sent the VN-Index down to around 470 points early in the session, the Index recovered to close up by about 1 percent to 477.47 points. The value of trades stood at about half of last Friday's level, reaching only VND401.5 billion (US$19.1 million), on a volume of 19 million shares.

Among the 10 leading shares by capitalisation, insurer Bao Viet Holdings (BVH) recovered from a heavy plunge at the start of the session to close up by 4.7 percent, while food producer Masan Group (MSN) closed up 0.9 percent despite hitting its floor price earlier.

Mid-cap and penny shares massed to support the VN-Index, with financial information site noting that advancers nearly doubled decliners overall.

On the Ha Noi Stock Exchange yesterday, the HNX-Index saw ups and downs but concluded the session at 83.28 points, an overall gain of 0.7 percent. Around 30.5 million shares changed hands, worth about VND392 billion ($18.7 million), increases of 40 percent in volume and 33 per cent in value compared to last Friday.

"The two bourses revived slightly after tumbling last week, particularly the HNX-Index. However, cash flow into the market remained low and economic factors have not suggested positive changes," said Le Van Thanh Long, an analyst for a HCM City-based securities company.

Foreign investors were net buyers of VND17.4 billion ($829,000) worth of shares in HCM City, doubling last Friday's figure. They favoured Saigon Securities Inc (SSI) and Vietinbank (CTG), buying VND10.6 billion ($505,000) and VND5 billion ($238,000) worth of each, respectively. Net buys in Ha Noi were mainly focused on securities shares such as Kim Long Securities Co (KLS), VNDirect (VND) and Bao Viet Securities Co (BVS).


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This year in Thailand-what next?

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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.

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