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ASEAN STOCK WATCH Asean Affairs   16  November  2010

ASEAN to Lead World Higher

Shayne Heffernan

ASEAN Markets will managed to add to gains today after strong leads from Wall St and Japan.

The Dow Jones industrial average ended up 9.39 points, or 0.08 per cent, at 11,201.97, according to the latest available figures. The Standard & Poor's 500 Index was down 1.46 points, or 0.12 per cent, at 1197.75. The Nasdaq Composite Index was down 4.39 points, or 0.17 per cent, at 2513.82.

OLAM, PTT, IVL, PTTEP, UOB all look like good buys today in ASEAN, the Palm Oil sector is a strong buy as we expect to see a rapid recovery in stocks in that business from Indonesia to Malaysia.

In Jakarta the JCI lost 9.38 points, or 0.3 percent, to close at 3,656.46. About 6.6 billion shares worth Rp 4.8 trillion ($538 million) changed hands.

Decliners outnumbered gainers 122 to 87.

Commodities such as agricultural goods, palm oil and rubber fell on speculation that China’s central bank would raise its key interest rate to cool food price inflation that has driven edible oil prices to two-year highs.

Agriculture stocks led the index lower, with Astra Agro Lestari, the nation’s biggest listed plantation firm, losing 4 percent to Rp 11,750 amid declining palm oil prices.

The finance sector also was down, with Bank CIMB Niaga, the fifth-largest bank by assets, losing 1.3 percent to Rp 1,540.

It announced on Monday that it planned to hold a Rp 1.5 trillion rights issue on Dec. 30, which would dilute existing share value.

Gains from the most active stocks by value helped limit JCI losses. Coal miner Bumi Resources rose 4.1 percent to Rp 2,550, and Berau Coal gained 6.3 percent to Rp 510.

Demand for coal assets grew on news that China would become the world’s biggest electricity user by 2012.

State-owned Krakatau Steel continued to advance after its stock exchange debut last week, climbing 1.6 percent to Rp 1,300.

The rupiah extended declines, falling to 8,958 against the dollar, its lowest level in more than two weeks.

The currency fell on news from the Group of 20 summit last week that emerging markets would implement capital controls to curb rising foreign inflows.

Bank Indonesia will reportedly meet with the Finance Ministry soon to discuss managing inflows, which put the economy at risk if investors suddenly sell off Indonesian assets.

In Manila the Philippine Stock Exchange index added 62.64 points, or 1.54 percent, to close at 4,139.32.

All the indices were up, with the gains led by the industrial and holding firm sectors whose indices surged by 2.38 percent and 2.42 percent, respectively.

There were twice as many advancers as decliners while 31 stocks were unchanged.

The rebound was led by Philippine Long Distance Telephone Co., SM Investments Corp., Ayala Corp., Alliance Global Group Inc., Energy Development Corp., Aboitiz Power Corp., Metropolitan Bank & Trust Co., Banco de Oro Unibank Inc., Metro Pacific Investments Corp., DMCI Holdings Inc., Megaworld Corp., International Container Terminal Services Inc., JG Summit Holdings Inc., Ayala Corp. preferred “A” shares, Filinvest Land Inc., First Gen Corp., San Miguel Corp. and Philippine National Bank.

Stocks on Bursa Malaysia rose 0.12% to close at 1501.56 points amid cautious sentiment.

Active stocks included JOTECH, KNM, KBUNAI, TIME, RAMUNIA, HUBLINE, CNI, SALCON, TEJARI and POHKONG. Trading volume declined to 1086.85 mil shares worth RM1256.45 mil as compared to Friday’s 1724.70 mil shares worth RM2393.77 mil.

The Winners were GENTING (+30 sen to RM10.46), GAMUDA (+9 sen to RM3.55), YTLP (+5 sen to RM2.53), MISC (+8 sen to RM8.68) and CIMB (+1 sen to RM8.31).

The Losers were SIME (-7 sen to RM8.78), MAYBANK (-4 sen to RM9.16), AMMB (-6 sen to RM6.13), PUBLIC BANK (-2 sen to RM12.76) and IOI (-1 sen to RM5.89). Market breadth was negative with 330 gainers as compared to 442 losers.

Market sentiment was cautious because of the recent volatility and investors chose to wait on the sidelines for fresh leads.

The Finance Index lost 0.21% to 13788.07 points, the Properties Index fell 0.81% to 999.19 points and the Plantation Index added 0.02% to 7772.93 points.

The market traded within a range of 6.52 points between an intra-day high of 1503.56 and a low of 1497.04 during the session.

The Stock Exchange of Thailand (SET) composite index on Monday rose 10.28 points or 1.01 per cent to close at 1,029.14 points. The market value was 34.07 billion baht, with 4.51 billion shares traded.

Indorama Ventures Limited is one of the largest vertically integrated polyester and PET chain producers in the world and a leading global manufacturer of wool yarns.

Shares of IVL closed Friday March 05, 2010 on the SET at 14.10 baht, up 60 satang, in trade worth 1.17 billion baht at the time Ebeling Heffernan expected to see the price approach 20baht by 2011.

Indorama Ventures have doubled that goal by reaching 38 Baht in Thailand today and Shayne Heffernan of Ebeling Heffernan has raised the firms outlook to 53 Baht in 2011.

Top five most active values were as follows;

TRUE closed at 36.05 baht, up by 1.00 or 19.80 per cent.

IVL closed at 50.00 baht, up by 3.25 or 6.95 per cent.

PTTEP closed at 182.00 baht, down by 0.50 or 0.27 per cent.

AJ closed at 33.75 baht, down by 4.25 or 11.18 per cent.

KBANK closed at 120.00 baht, up by 0.50 or 0.42 per cent.

In Singapore the STI began the week with a fall of .5% amid mixed performances in the regional markets.

Sentiment was cautious amid speculation and denials that Ireland faces a Greek-style economic bailout while analysts warned that the turmoil risks spreading across the eurozone.

In Singapore, the Straits Times Index (STI) fell 15.20 points to close at 3,236.80, as investors booked profit on expectations that the benchmark index will likely continue to shed some of its recent gains.

In the broader market, losers overtook gainers 357 to 140. Overall volume traded was thin, with 1.71 billion shares changing hands.

Among the local banks, OCBC lost 1.8% to S$9.80, DBS fell 0.3% to S$14, but UOB rose 0.3% to S$18.48.

Commodity player Olam International shed 2.2% to S$3.18 after it announced over the weekend a US$1.3 billion investment in Gabon to build a joint venture fertilizer plant.

Noble Group fell 2.8% to S$2.08, while container company Neptune Orient Lines lost 2.7% to S$2.16.

Bucking the broad market decline, transport company ComfortDelgro rose 3.4% to S$1.51 after it announced on Friday a 10.4% increase in its third-quarter net profit.

Shayne Heffernan brings more than 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over US$500m and 1 that reach a peak market cap of US$15billion. He has managed and overseen start-ups in Mining, Shipping, Technology and Financial Services.


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