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ASEAN STOCK WATCH Asean Affairs   3 May 2012

ASEAN MArket Outlook

By Shayne Heffernan Ph.D.
 

ADB president Haruhiko Kuroda said the Philippines and its neighbors were poised to weather the effects of a mild recession in the Euro zone this year, but stressed the urgent need for member-countries to address the wide income inequality in their jurisdictions.

Kuroda said the crisis in the Euro zone was not expected to cause a significant drag on growth rates of Asian economies and on remittances that countries like the Philippines receive.

“We expect a rosier 5 to 6 percent GDP growth for 2012” not only because of “strong spending” but also because of the government’s “strong resolve on good governance,” Public Works Secretary Rogelio L. Singson said.

GDP or gross domestic product is the value of goods produced and services rendered in the country in a given period. It excludes remittances by overseas Filipino workers and earnings of Philippine firms abroad.

Singson enumerated other signs of economic improvement:

Economic growth becomes meaningful when it leads to poverty reduction, and when income distribution becomes closer to being perfectly even, according to Kuroda.

“The Asia Pacific region should be able to maintain its growth momentum despite the ongoing troubles elsewhere in the world,” the ADB head said.

“However … the benefits of growth have yet to reach several hundreds of millions of Asians who continue to struggle on less than $1.25 a day,” Kuroda said.

Ironically, key factors for Asia’s economic development—technological advancement, globalization, and market-oriented reforms—were also the cause of the wide disparity of incomes in Asian countries.

This is because such developments make it difficult for the poor, both individuals and micro enterprises, to compete in labor and capital markets, respectively.

Hong Kong

China City Railway Transportation (8240) opens its retail book today, requiring a minimum investment of about HK$5,000 for one board lot of shares.

The Beijing-based provider of electronic components to railway operators plans to issue 200 million shares.

The Growth Enterprise Market listing candidate is offering 4,000 shares in a board lot with a price range of between HK$0.95 and HK$1.23 per share.

The minimum subscription amount is HK$4,969, with trading set to start on May 16.

The IPO is expected to raise up to HK$246 million, with 68 percent of it to be used for expanding in the mainland and 11 percent on research and development of new technology.

China

About 9.16 billion shares changed hands in the Shanghai Composite on April 27, or 16 percent higher than the daily average this year. Thirty-day volatility in the gauge was at 16.79, the lowest in two months.

The Shanghai Composite Index gained 42.12 points, or 1.8 percent, to 2,438.44 at the close. The CSI 300 Index (SHSZ300) advanced 2.2 percent to 2,683.49. China’s markets were shut April 30 and May 1 for the holidays. The Bloomberg China-US 55 Index (CH55BN), a measure of the most-traded U.S.-listed Chinese companies, advanced 1.1 percent to 104.65 at the close in New York yesterday.

The Shanghai index has climbed 11 percent this year amid speculation the government will take measures to boost the economy. Stocks in the gauge are valued at 10.5 times estimated earnings, compared with a record low of 8.9 times on Jan. 6.

Thailand

The SET Index (SET) rose for a sixth day, climbing 0.9 percent to 1,239.06, the highest close since July 1996. Thai financial markets were closed yesterday.

Rubber producers: Sri Trang Agro-Industry Pcl (STA) , Thailand’s largest rubber producer, gained 2.5 percent to 20.70 baht, the most since Feb. 22. Thai Rubber Latex Corp. (Thailand) Pcl (TRUBB) added 1 percent to 5.05 baht, the highest level since April 4. Rubber futures added 0.6 percent to 315.8 yen a kilogram ($3,921 a metric ton) in Tokyo, the highest close since April 10.

Big C Supercenter Pcl (BIGC) , Thailand’s second-biggest hypermarket operator, climbed 2.9 percent to 195.50 baht, a record close. Profit in the first quarter jumped 89 percent to 1.78 billion baht ($59 million), it said in a regulatory filing.

Eastern Water Resources Development & Management Pcl (EASTW) , the nation’s largest private water supplier, jumped 4.8 percent to 8.80 baht, a record close. The company plans to raise capital spending by 40 percent after demand from manufacturers grew at more than twice the pace it estimated, Chief Executive Officer Praphant Asava-aree said in an interview on April 30. Profit this year will beat last year’s record because of an increase in water shipment and tariffs, he said.

PTT Pcl (PTT) , Thailand’s largest oil company, advanced 2.3 percent to 359 baht, the highest close since April 3. Crude oil yesterday rose 1.2 percent to $106.16 a barrel, the highest close since March 27.

Singapore

Singapore and Malaysia expect to link their stock exchanges in June this year to allow brokers in one country to buy shares in the other without having to go through an intermediary, the two countries’ bourse operators said on Friday.

“Bursa Malaysia and Singapore Exchange (SGX) will be connected first, with the Stock Exchange of Thailand (SET) added in August 2012,” ASEAN Exchanges, a group of regional bourse operators, said in a statement.

Speaking on behalf of ASEAN Exchanges, SGX Chief Executive Magnus Bocker said the start of the Singapore-Malaysia electronic trading link will mark the first key milestone to facilitate cross-border stock trading in Southeast Asia.

“The three bourses that will participate in the first stage of the ASEAN Trading Link represent approximately two-thirds of the $2.1 trillion market capitalisation of the seven members of the ASEAN Exchanges,” he said.

ASEAN, which stands for the Association of Southeast Asian Nations, is a regional grouping that comprises 10 countries - Indonesia, Thailand, the Philippines, Malaysia, Singapore, Brunei, Vietnam, Myanmar, Cambodia and Laos.

The seven members of ASEAN Exchanges are SGX, Bursa, SET, the Jakarta Stock Exchange, the Philippine Stock Exchange, the Hochiminh Stock Exchange and the Hanoi Stock Exchange.

The idea to allow seamless trading among Southeast Asia’s bourses came up about four years ago as ASEAN sought to attract portfolio investors drawn to the larger Asian markets of China and India.

Indonesia

Indonesia’s benchmark stock index rose on Monday, lifted by a spate of positive earnings results from companies including Unilever Indonesia.

The Jakarta Composite Index gained 16.75 points, or 0.4 percent, to 4,180.73, rebounding from Friday’s 0.4 percent decline. The stock measure closed April up 1.4 percent, its smallest advance for the month since April 2008, when it lost 5.8 percent, according to Bloomberg data.

More than 4.41 billion shares valued at Rp 5.39 trillion ($587 million) traded on the Indonesia Stock Exchange on Monday. Gainers outnumbered decliners 123 to 120. Foreign investors bought Rp 417.4 billion more in shares than they sold.

Unilever, the nation’s biggest consumer products manufacturer, rose 2.9 percent to Rp 19,850 after reporting that its first-quarter profit climbed 18 percent.

Indofood Sukses Makmur, the biggest diversified food producer, gained 3.2 percent to Rp 4,850, while its unit Indofood CBP Sukses Makmur surged by 9.7 percent to Rp 5,650.

Cigarette maker Gudang Garam rose 2.9 percent to Rp 59,200.

Adaro Energy, the second-largest coal miner, gained 2.8 percent to Rp 1,860 after it announced on Friday a Rp 63 per share dividend payment.

London Sumatra Indonesia, the plantation company affiliated with Indofood, fell 2.5 percent to Rp 2,925 after lower crude palm oil prices caused its profit to fall.

The rupiah traded flat at 9,190 to the dollar on Monday, gaining 0.1 percent for the month.


Yesterday in Asia

SOUTHEAST ASIAN STOCK MARKETS   
 Change on day
 Market             Current     Prev Close    Pct Move
 Singapore          3006.14       2978.57       +0.93
 Kuala Lumpur       1582.39       1570.61       +0.75
 Bangkok            1239.06       1228.49       +0.86
 Jakarta            4219.30       4195.98       +0.56
 Manila             5228.84       5202.70       +0.50
 Ho Chi Minh         472.46        473.77       -0.28
    
 Change on year
 Market             Current     End prev yr    Pct Move
 Singapore          3006.14       2646.35      +13.60
 Kuala Lumpur       1582.39       1530.73       +3.37
 Bangkok            1239.06       1025.32      +20.85
 Jakarta            4219.30       3821.99      +10.40
 Manila             5228.84       4371.96      +19.60
 Ho Chi Minh         472.46        351.55      +34.39
    
 Stock Market Volume (shares)
 Market          Current Volume    Average Volume 30 days
 Singapore         252,880,900          239,962,757     
 Kuala Lumpur      112,301,900          122,177,487     
 
 Bangkok             4,628,710            4,111,651     
 Jakarta         3,931,185,000        3,660,849,667   
 Manila                 97,661              136,804   
 Ho Chi Minh           118,284               90,488

Most Southeast Asian stock markets rose on Wednesday, with benchmark indexes in the Philippines and Indonesia reaching all-time highs, as strong US economic data boosted investor appetite for risky assets, particularly the region's energy and commodities stocks.

Jakarta's Composite Index ended at 4,219.3, surpassing its previous record reached on April 3, while the Philippine index finished at 5,228.84.

Thailand's main SET index marked a new 16-year high, with foreign investors buying shares for a net 628.87 million baht ($20.45 million) on the day, the Thai bourse said.

Malaysia also reported foreign inflows of 210 million ringgit ($69.40 million), stock exchange data showed.

Tokyo rose 0.31 percent, or 29.30 points, to 9,380.25 and Seoul climbed 0.86 percent, adding 17.08 points to 1,999.07 while Sydney closed 0.14 percent, or 6.4 points, higher at 4,435.9.

Hong Kong was 1.02 percent higher, gaining 214.87 points to 21,309.08 while Shanghai climbed 1.76 percent, or 42.12 points, to 2,438.44.

– Singapore closed 0.93 percent higher, adding 27.57 points to 3,006.14.

DBS Bank gained 1.36 percent to end at Sg$14.15 while palm oil producer Wilmar International was up 1.44 percent at Sg$4.94.

– Taipei climbed 2.33 percent, or 175.09 points, to 7,676.81.

Leading smartphone maker HTC rose 6.66 percent to Tw$472.5 while Taiwan Semiconductor Manufacturing Co. was 1.84 percent higher at Tw$88.4.

– Manila rose 0.50 percent, or 26.14 points, to 5,228.84.

Alliance Global Group gained 5.17 percent to 13 pesos and Universal Robina was up 3.07 percent at 67 pesos but Bloomberry Resorts slumped 24.9 percent to 9.01 pesos.

– Wellington advanced 1.05 percent, or 37.65 points, to 3,614.97.

Contact Energy climbed 1.65 percent to NZ$4.93 and Fletcher Building jumped 2.20 percent to NZ$6.50 while Telecom was unchanged at NZ$2.64.

– Jakarta rose 0.56 percent, or 23.31 points, to 4,219.30.

– Kuala Lumpur added 0.75 percent, or 11.78 points, to 1,582.39.

Financial firm CIMB Group Holdings gained 1.48 percent to 7.52 ringgit and plantation giant Sime Darby added 0.10 percent to 9.75 ringgit.

– Bangkok climbed 0.86 percent, or 10.57 points, to 1,239.06.

Banpu rose 2.16 percent to 568 baht and PTT Plc gained 2.28 percent to 359 baht.

– Mumbai slid 0.10 percent, or 16.90 points, to 17,301.91.

India’s leading vehicle maker Tata Motors fell 3.82 percent to 304.65 rupees while rival Maruti Suzuki India closed down 2.76 percent to 1,332.1, after most auto firms posted disappointing car sales data for April.

Shayne Heffernan Ph.D.  

Linda Johnson, Business Development Director - Private Client Group, Heffernan Capital Management
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ASEAN  ANALYSIS

This year in Thailand-what next?

AseanAffairs   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.

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