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ASEAN STOCK WATCH Asean Affairs   2  November  2010

ASEAN Market Outlook Today

Shayne Heffernan

ASEAN Markets may come under some pressure this morning after a weak overnight session on Wall St. The Dow Jones Index lost most of a 100plus rally as bank stocks sank and investors were nervous about midterm elections and expected easing measures by the Federal Reserve.

The Dow Jones Industrial Average 11,125 rose 6.13 points, or 0.1%, to 11,124.62. Leading the gains, Intel Corp. INTC 20.56, rose 2.6%.

The S&P 500 index closed at 1,184,gained 1.12 points, or 0.1%, to 1,184.38. A report that the Securities and Exchange Commission is investigating JP Morgan Chase scared investors away from bank stocks.

Financial's rate as a strong buy in ASEAN today, TMB, OCBC, UOB, SCB along with all the regions major banks will be worth buying at open.

In Kuala Lumpur the Bursa Malaysia rose 0.27% to close at 1509.66 points on continuous buying interest in selected heavyweights and lower liners, tracking gains in Asian equity markets after China’s manufacturing data showed activity expanded at the fastest pace in six months in October.

Most actively traded stocks include KBUNAI, HWGB, CAROTEC, HWGB-WB, DAYA, L&G, HOVID, TALAM, TMCLIFE and JOTECH.

Trading volume declined to 1271.41 mil shares worth RM1512.18 mil as compared to Friday’s 1462.58 mil shares worth RM2342.71mil.

The Winners were CIMB (+7 sen to RM8.36), GENTING (+12 sen to RM10.56), BAT (+136 sen to RM47.88), SIME (+4 sen to RM8.87) and IOI (+3 sen to RM5.85).

The Losers were AXIATA (-3 sen to RM4.46), MISC (-6 sen to RM8.72), TNB (-1 sen to RM8.79), GENM (-1 sen to RM3.49) and TELEKOM (-1 sen to RM3.39). Market breadth was negative with 344 gainers as compared to 440 losers.

The Finance Index added 0.39% to 13772.68 points, the Properties Index climbed 0.25% to 990.26 points and the Plantation Index surged 0.55% to 7627.46 points. The market traded within a range of 4.93 points between an intra-day high of 1511.24 and a low of 1506.31 during the session.

Shayne Heffernan of Ebeling Heffernan has put a Price Target on Yee Lee Corp. $1.50 in 2011.

Yee Lee has seen a strong run forward since 2009, based on the low P/E this stock should rally back toward $1.50.

This is an International Award Winning Company.

Palm Oil and the other Oils produced by Yee Lee have seen strong demand and strong price increases.

Diversification in to the other retail and industrial products has set a secure future.

Yee Lee Corporation Bhd group (YLC) began its core business as an edible oil repacker in Malaysia in 1968. Since then it has grown into a fully integrated manufacturer and distributor. YLC group of companies are involved in various sectors such as manufacturing, marketing and distribution of fast moving consumer products, plantation and eco-tourism.

Today YLC has an established marketing and distribution network servicing both local as well as international customers. YLC products include food, bottled water, oral care, household cleaners and industrial products. It also manufactures corrugated cartons, gloves and PET bottles for a wide range of customers.

YLC was listed on the Bursa Malaysia (formerly known as the Kuala Lumpur Stock Exchange) in 1993.

Yee Lee Corporation Bhd (YLC) is a Malaysia-based investment holding company. The Company, through its subsidiaries, operates in four segments: manufacturing, which includes cooking oils, margarine, shortening, corrugated paper cartons, crude palm oil, kernel and general line tin cans; trading, which includes edible oils, kernel and other consumer products; plantation, which includes tea and palm oil, and others, which include tourism related services and investment holding.

Its direct subsidiaries are Yee Lee Trading Co. Sdn. Bhd., Yee Lee Palm Oil Industries Sdn. Bhd., Yee Lee Edible Oils Sdn. Bhd., South East Asia Paper Products Sdn. Bhd., Canpac Sdn. Bhd., Intanwasa Sdn. Bhd. and Yee Lee Marketing Sdn. Bhd. In addition, the Company also has seven indirect subsidiaries.

In Singapore the STI closed 1.58 per cent higher on Monday, with the benchmark Straits Times Index at 3,192.18, up 1.58 per cent, or 49.56 points.

Around 1.8 billion shares exchanged hands.

Gainers beat losers 339 to 177.

Singapore rig builders outperformed the broader market, as the investors expect Brazilian state oil firm Petrobras to announce orders for new rigs soon, following the outcome of Brazil’s general election.

Keppel Corp, the world’s largest rig-builder, rose 2.4 percent to S410.22 while its rival Ebeling Heffernan Strong Buy Sembcorp Marine was up 2.6 percent at S$4.72.

Another Ebeling Heffernan Strong Buy Oversea-Chinese Banking Corp was up 1.8 percent at S$9.17, before announcing during the lunch break that its third quarter net profit rose 27 percent to S$570 million, due to falling bad debt charges and higher insurance income.

In Jakarta the JCI gained 9.8 points, 0.3 percent, to close at 3,645.15. About 4.5 billion shares worth Rp 5.1 trillion ($565 million) changed hands. Decliners edged out gainers 109 to 107.

The highly anticipated initial public offering of state-owned Krakatau Steel begins today under a cloud, with allegations of corruption surrounding the event and the nation’s antigraft body taking note of the scandal.

Lawmakers have called on the state to delay the IPO, as analysts questioned why the listing price — set at Rp 850 (8 cents) per share — was “too low.” Some have suggested that corruption was at play and that officials stood to make a quick profit from the deal.

Despite these claims, Indonesia Stock Exchange (IDX) president director Ito Warsito and the State Enterprises Ministry said on Sunday that the IPO would go ahead as scheduled.

The ministry had announced the price of shares on the low end of the Rp 800 to Rp 1,150 range, despite the fact that the offering had been oversubscribed several times and had generated strong interest among foreign investors during road shows.

The October purchasing managers’ indexes from rapidly growing China and India helped boost market sentiment, reversing the sluggish trend in early trade, analysts said.

Coal producer Bumi Resources, Asia’s biggest exporter of power-station coal, climbed 1.1 percent to Rp 2,250.

Adaro Energy, Indonesia’s second-largest coal producer, gained 1.2 percent to Rp 2,125.

Power-station coal at Australia’s Newcastle port, an Asian benchmark, rose 1.5 percent to $100.48 a metric ton last week, rising for the third-consecutive week.

Astra Agro Lestari, the nation’s biggest listed plantation company, rose 0.6 percent and Bakrie Sumatera Plantations advanced 2.6 percent as palm-oil futures hit a two-year high.

January-delivery futures rose as much as 1.1 percent to 3,095 ringgit ($1,000) a metric ton in Kuala Lumpur trading, the highest intraday level since July 2008.

Indofood CBP Sukses Makmur, the world’s top instant-noodle maker, fell 2.6 percent.

Wheat for December delivery rose as much as 1.2 percent to $7.2575 before retreating slightly. Indofood uses wheat to make its noodles.

Telekomunikasi Indonesia, the nation’s top telecom, fell 5 percent after Bahana Securities cut its rating to “hold.” It was its steepest drop since December.

Meanwhile, the rupiah rose the most in a week, advancing 0.2 percent to 8,923 per dollar as of the stock market’s close, after a government report on Monday showed that exports increased for a 12th month, supporting the outlook for economic growth and inflows from overseas.

The rupiah has strengthened 5.2 percent this year as global funds pumped $2.3 billion into the nation’s equities.

Consumer prices rose 5.67 percent last month from a year earlier, the Central Statistics Agency said on Monday.

In Bangkok The Stock Exchange of Thailand SET index closed at 1,003.24, up 18.78 or 1.91% in trade worth 39.84 billion baht on Monday.

Shayne Heffernan’s Strong Buy on PTTEP paid fast dividends as the stock surged almost 5%.

Bangkok Post reported Telecoms, energy, automotive and insurance companies are considered top candidates to seek listings on the stock market next year, says Chanitr Charnchainarong, group head of issuers and listings of the Stock Exchange of Thailand.

The four industries are growing strongly and will require more funds to support expansion, said Mr Chanitr, who is also the president of the Market for Alternative Investment (MAI).

“Thus, they have high potential to raise funds in the capital markets. Insurance companies, for instance, seem quite ready to seek listings in compliance with new legal requirements,” he said.

Insurers, which are regulated by the Office of the Insurance Commission (OIC), will be required to become public companies by 2012.

The OIC rule carries the same requirements that the Securities Exchange Commission uses for listed companies.

A securities company executive who declined to be named said that it had three insurers and at least five companies in the power and energy business in the pipeline for potential market listings.

The energy sector, especially alternative energy, is another promising area that the SET is trying to attract, said the executive.

Stocks with most active value were as follows:

PTTAR increased to 32.00 baht, up 2.25 baht or 7.56%.

PTTEP increased to 179.50 baht, up 8.50 baht or 4.97%.

PTTCH increased to 147.50 baht, up 6.50 baht or 4.61%.

PTT increased to 309.00 baht, up 6.00 baht or 1.98%.

TOP increased to 55.00 baht, up 2.00 baht or 3.77%.


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