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ASEAN STOCK WATCH Asean Affairs   16  October  2010

Weekly Summary Of ASEAN Markets

Shayne Heffernan

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


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.

Winners 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).

Losers 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.

In Bangkok the SET index closed at 997.15, up 3.43 or 0.35% in trade worth 35.53 billion baht on Friday.

Stock investors are betting on the possibility that the Stock Exchange of Thailand index will break through 1,000 points soon, after it came within half a point of four digits yesterday.

SET president Charamporn Jotikasthira said strong fundamentals including high corporate earnings growth and domestic and foreign capital inflows would support the SET index, which is rallying in line with major exchanges in Asia.

The index closed yesterday at 993.72, up 1.12 points, on turnover of 47.4 billion baht. It peaked at 999.51 in the afternoon.

Since the start of this year, the SET has gained 35%, close to the gains of 38% in Manila and Jakarta, said Mr Charamporn. He does not expect it to fall back easily but to adjust in line with the change in economic fundamentals.

Stocks with most active value were as follows:

PTTAR increased to 30.75 baht, up 1.00 baht.

PTTCH increased to 137.50 baht, up 4.50 baht.

PTT was unchanged at 313.00 baht.

ADVANC increased to 95.50 baht, up 1.25 baht.

BBL decreased to 158.50 baht, down 1.50 baht.

Singapore Equities rose 11.83 points or 0.37 percent on Friday with the benchmark Straits Times Index (STI) closing at 3,206.85 points.

Singapore’s biggest ever public share floats has attracted huge interest from small investors, with over $2.2 billion chasing the shares worth $200 million reserved for retail investors.

The red-hot response to the initial public offering (IPO) for Global Logistics Properties (GLP) sets up a sizzling trading debut for the counter on the Singapore Exchange (SGX) on Monday.

GLP, the logistics unit of the Government of Singapore Investment Corp, owns 296 warehouses and other industrial properties in Japan and China, two of the world’s biggest economies.

Based on its IPO price, GLP will be among the top 30 SGX listed companies by market value, at about $8.8 billion.

GLP is Singapore’s largest IPO since SingTel went public in 1993, set to raise an estimated $3.9 billion.

The lion’s share of this IPO went to institutional players and other larger investors, but 102 million shares were made available to retail investors.

The overall volume stood at 1.50 billion shares worth 1.73 billion Singapore dollars (about 1.33 billion U.S. dollars).

In Manila the Philippine Stock Exchange index slipped 1.24 percent or 52.31 points to 4,166.52, while the broader all-share index similarly shed 1.06 percent or 28.50 points to 2,659.70 points.

All sub-indices went in the red, with property shares dropping the most by 3.16 percent or 49.78 points to 1,525.51.

Decliners outnumbered advancers, 101 to 41, while 25 remained unchanged.

A total of 1.4 billion shares worth P6.08 billion changed hands. “The market declined to the lack of leads locally, and the sideways movement of the US market,” a local broker said.

The main Dow Jones Industrial Index gained just 0.04 point or 3.86 points on Monday.

The trader said local investors might be positioning their portfolios in time for the release of third quarter earnings results starting next week. Local companies are expected to post higher profits mainly on the back of the stronger economy.

The drop in property shares, meanwhile, was caused by the recent news that the listing of Real Estate Investment Trusts (REIT) instruments might not push through this year.

SM Investments Corp. was the most actively traded share, falling by 1.98 percent.

In Jakarta the index lost 21.45 points, or 0.6 percent, to close at 3,597.03. About 5.6 billion shares worth Rp 4.97 trillion ($556.6 million) changed hands. Decliners outnumbered gainers 123 to 88. Overall, the index climbed 1.5 percent this week.

The steep hikes on the country’s stock market have caused concern about long-term sustainability, with some economists warning large capital outflows from foreign investors could cause a serious shock.

State-owned Negara Indonesia saw its earnings jump 60 percent in the third quarter, with results boosted by rising interest income and strong performance from its Shariah unit, president director Gatot Suwondo said on Friday.

“We’re consistent in our strategy of focusing loans to the infrastructure sector, resulting in the 60 percent increase in profit this quarter,” Gatot said on Friday. BNI, Indonesia’s fourth-largest lender, has plans to lend more than Rp 20 trillion ($2.2 billion) to infrastructure projects this year.

In a statement, the bank said profit had risen to Rp 2.96 trillion ($331.5 million), from Rp 1.85 trillion in the year-earlier period. Net interest income increased to Rp 8.6 trillion in the third quarter, up from Rp 8.09 trillion last year, and its Shariah unit recorded Rp 391.21 billion in income, from Rp 219.65 billion over the same period last year.

Gatot added that the bank had also reduced its asset and liability costs.

BNI’s also announced that its total assets increased to Rp 224.81 trillion in the third quarter, up from Rp 203 trillion in the year-earlier period.

The financial report also paves the way for BNI to carry out its planned Rp 7 trillion rights issue in December. Under a deadline set by the State Enterprises Ministry, BNI was required to publish the report by Friday, or else the rights issue would’ve been postponed until next year.

“We’re very optimistic that BNI will have a successful rights issue this year,” Gatot said.

BNI is looking to sell 3.37 million new shares in the sale, equivalent to 16 percent of its total enlarged capital.

Juniman, chief economist at Bank Internasional Indonesia, said BNI’s jump in profit would impress investors ahead of the bank’s rights issue, but he warned investors about the main factor behind BNI’s strong performance.

“We can see that BNI’s net interest income increased slightly, but the main factor behind BNI’s profit this quarter was the decrease in its non-performing loans, which amounted to around Rp 1 trillion,” he said. “BNI needs to show a significant effort to boost its operating income in the fourth quarter. Relying on decreasing NPL to boost profit would provide a limited amount of profit.”

BNI’s net NPL ratio dropped to .74 percent, down from 1.9 percent during the third quarter last year.

“But the bottom line for investors is net profit, and BNI has shown a significant increase. So I think their rights issue will do well,” Juniman said BNI is planning the rights issue in order to maintain a capital adequacy ratio of 15 percent while increasing loans by 15 to 18 percent this year. BNI’s CAR is 13 percent, against the central bank’s minimum of 8 percent.

Elnusa, an oil services company, fell 2.7 percent to Rp 355, halting a two-day gain with crude oil trading below $83 a barrel after a government report showed US petroleum demand had dropped to its lowest level in more than 10 months as refiners curtailed processing runs.

Poultry company Malindo Feedmill tumbled 10.6 percent to Rp 1,100 after a jump in prices for soybean and corn, which are used in animal feed. Soybean futures in Chicago on Thursday advanced to their highest level in 16 months on optimism that demand for US crops would remain strong.

Timah, the country’s biggest tin producer, dropped 1.5 percent to Rp 3,325. Tin futures on Thursday dropped 0.5 percent to $26,805 a ton in London, after hitting a record high on Thursday.

Meanwhile, the rupiah slipped 0.1 percent on Friday on speculation the central bank would curb appreciation because it was hurting exporters. As of the stock market’s close, the rupiah was trading at 8,923 per dollar, near its strongest level in three years.

The currency has climbed 5.2 percent this year. It gained 0.1 percent for the week.

Muliaman Hadad, deputy governor at Bank Indonesia, had said it was monitoring currency developments “very closely” to prevent too much fluctuation.

“The purpose of the central bank is to calm down volatility in the exchange rate,” said Aris Setiawan, a foreign-exchange trader at Bank Chinatrust Indonesia. Bank Indonesia “is trying to maintain a certain level,” he added.

So far, however, the central bank has said it was not planning to intervene in currency markets.

Overseas investors have bought $2.4 billion more Indonesian shares than they have sold this year through Thursday, according to data from the Indonesia Stock Exchange (IDX).

Global funds increased their holdings of government bonds by 73 percent this year to Rp 187.3 trillion, according to the Ministry of Finance’s Web site.


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