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ASEAN STOCK WATCH Asean Affairs  15  October  2010

ASEAN Stocks to Fall on Currency and Recovery Issues

Shayne Heffernan

A series of poor economic results in the USA and the ongoing battle over currency values will see the ASEAN markets open lower today.

In Kuala Lumpur the Bursa Malaysia eased 0.04% to close at 1496.38 points, reversing earlier gains on profit taking in selected stocks such as CIMB and Genting.

Most Active stocks include TIMECOM, JCY, TA, GPACKET-WA, CIMB, MALTON, TIME, JOTECH, MULPHA and SCOMI. Trading volume increased to 1274.42 mil shares worth RM2041.57 mil as compared to Wednesday’s 1199.52 mil shares worth RM2026.78 mil.

Losers were GENTING (-26 sen to RM10.20), CIMB (-7 sen to RM8.00), AXIATA (-3 sen to RM4.56), GENM (-3 sen to RM3.55) and GAMUDA (-4 sen to RM3.90).

Winners were IOI (+6 sen to RM5.80), PTG (+46 sen to RM11.50), KLK (+40 sen to RM19.00), PUBLIC BANK (+4 sen to RM12.62) and YTL (+13 sen to RM7.80). Market breadth was negative with 348 gainers as compared to 455 losers.

The Finance Index ended flat at 13520.56 points, the Properties Index fell 0.71% to 959.26 points and the Plantation Index rose 1.07% to 7338.83 points.

The market traded within a range of 13.25 points between an intra-day high of 1503.82 and a low of 1490.57 during the session.

Singapore Straits Times Index closed 0.22 percent lower on Thursday, The benchmark Straits Times Index (STI) fell 7.14 points to 3,195.02.

Wilmar International, climbed 4.2 per cent or 26 Singapore cents to S$6.41 on bullish sentiments about the palm oil sector in the near term. Despite early gains late profit taking pushed the index lower as investors held mixed views about the Monetary Authority of Singapore’s (MAS) tightening of its monetary policy.

The central bank moved to tighten monetary policy as fresh data affirmed forecasts that the economy could grow 13-15 percent this year. The Ministry of Trade and Industry (MTI) said the economy expanded an annual 10.3 percent in the third quarter.

While slower than the second quarter’s 19.6 expansion, the July-September data showed Singapore was on track to achieve blistering growth projections after last year’s 1.3 percent contraction caused by the global downturn.

Losers outpaced gainers 281 to 236, with 668 counters remaining unchanged. Overall volume traded was 2.04 billion shares worth S$2.14 billion.

The Stock Exchange of Thailand (SET) composite index on Thursday gained 1.12 points or 0.11 per cent to close at 993.72 points. The market value was 47.39 billion baht, with 4.87 billion shares traded.

Average daily turnover on the SET and the Market for Alternative Investment reached 36.14 billion baht.

The SET Index closed the quarter on Sept 30 at 975.30, a 22.32% rise over the second quarter, the highest quarterly gain in the region. The year-to-date gain was 32.78%.

Fund-raising through equity sales by listed companies rose 97.4% from the third quarter of last year.

Listed companies raised a total of 21.71 billion baht in the period, including 15 billion in an offering by Thai Airways International.

Foreign investors in the third quarter were net buyers of 59.99 billion baht in shares, with net buys for the first nine months at 41.45 billion.

The SET index forward price/earnings ratio as of Sept 30 was 14.03 times, up from 11.53 times in the second quarter.

Market capitalisation, at 7.94 trillion baht, was 82% of GDP, the highest percentage since 1996. The record was 105% of GDP in 1993, the boom era before the crash in 1997.

The Thailand Futures Exchange also recorded all-time highs with average turnover of 18,305 contracts per day, up 36.13% from the same period the year before and by 0.69% from the second quarter.

Top five most active values were as follows;

PTTAR closed at 29.75 baht, up by 1.25 baht or 4.39 per cent.

PTT closed at 313.00 baht, up by 4.00 baht or 1.29 per cent.

BANPU closed at 720.00 baht, down by 12.00 baht or 1.64 per cent.

KTB closed at 17.70 baht, up by 0.30 baht or 1.72 per cent.

PTTEP closed at 173.00 baht, up by 1.00 baht or 0.58 per cent.

In Manila, Philippine Stock Exchange index (PSEi) closed the day with a gain of 39.42 points or nearly 1 percent to 4,233.38 points. The broader all-share index was also up by nearly 15 points or half a percent to 2,685.91.

Except for the mining and oil index, all sub-indices went up, led by property, which added 31.13 points or nearly 2 percent to close at 1,595.22. Mining and oil share plunged 33.59 points or 0.26 percent to 12,885.53.

On Wall Street, the benchmark Dow Jones Industrial Index gained 0.69 percent, while the Standard & Poor’s and NASDAQ indices similarly gained 0.71 percent and 0.96 percent, respectively.

“Good corporate earnings in the US helped in our rally today. This provides optimism that the third-quarter earnings reports of Philippine companies may be better than expected,” a local trader said.

The day’s 88 advancers were more than enough to outnumber the 50 decliners, while 39 shares did not move. Trading was heavy, with more than two billion shares worth P12.2 billion changing hands, from just 888 million shares worth P5.44 billion on Wednesday.

In Jakarta the JCI rose 6.5 points, or 0.2 percent, to close at 3,618.48. Volume was heavy, with 11.6 billion shares worth Rp 8.95 trillion ($996.9 million) changing hands. Decliners outnumbered gainers 114 to 102.

Frederik Daniel Tanggela, an analyst at Sucorinvest Central Gani, said the gains might have gotten ahead of real economic and earnings growth, and questioned the sustainability of the rally. However, he said he was confident in the longer-term bullish trend, citing the country’s economic fundamentals.

Mobile phone service provider Bakrie Telecom fell 2 percent, its first decline in three days, after Eddy Kurnia, acting corporate secretary for Telkomunikasi Indonesia (Telkom), said no agreement hadbeen reached in Bakrie Telecom’s takeover of Telkom’s CDMA unit. Telkom was unchanged at Rp 9,050.

Oil services company Elnusa surged 5.8 percent higher, the biggest gain since Sept. 21. Bumi Resources, Indonesia’s largest coal miner, rose 1.1 percent to Rp 2,400, its highest level since May 18. Crude oil climbed for a second day in New York after an industry report showed US crude supplies fell and the Organization of Petroleum Exporting Countries moved closer to improve compliance with production cuts.

Property developer Lippo Karawaci plunged 17.7 percent to Rp 560, its steepest decline since September 2002. The company on Thursday said investors had raised $252 million from a share sale and announced a rights offer.

Gudang Garam, Indonesia’s second-biggest cigarette maker, gained 0.2 percent. Agus Suprijanto, acting head of the Finance Ministry’s fiscal policy agency, said the state may raise the excise tax on cigarettes starting Jan. 1 by an average of 5 percent.

Meanwhile, the rupiah advanced to near three-year highs, trading at 8,919 per US dollar as of the stock market’s close, on speculation a global stock rally will spur demand for emerging market assets. The MSCI Asia-Pacific Index of shares rose to a two-year high after Standard & Poor’s 500 Index of US equities on Wednesday had its best close since May.

Lindawati Susanto, head of foreign-exchange trading at Bank Resona Perdania, said the rupiah’s rise would be limited by central bank intervention.

“The rupiah appreciated following the increase in global stocks … [Bank Indonesia] will prevent the rupiah from strengthening much more,” she said. Central banks intervene in currency markets by arranging purchases or sales of foreign exchange.


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