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ASEAN STOCK WATCH Asean Affairs   19  October  2010

ASEAN Exchanges to Rally

Shayne Heffernan

ASEAN Shares will rebound strongly today after the USA surprised the market with a rally over night.

Banks rebounded on Citigroup earnings as we predicted yesterday and for those who bought in ASEAN today there will be a fast return. PTT is a stand out buy given its fall today and the speed at which the company is taking advantage of the stronger Baht.

Today we released a strong buy on Sembcorp Marine, Sembcorp Marine has closed over $700m USD worth of deals in the last month and is still trading at SG$4.50

Sembcorp Marine’s subsidiary Jurong Shipyard (JSPL) has secured orders of US$384 million for two turnkey jack-up rigs with options for another four jack-up rigs from Seadrill.

The total estimated value of the six jack-up rigs, including the four jack-up rig options is expected to surpass the US$1 billion mark. This contract with Seadrill will be the largest order of rigs to-date, reflecting the growing market segment for quality premium high specification jack-up rigs.

The Full Analysis can be seen at

In Jakarta the JCI fell 30.11 points, or 0.8 percent, to close at 3,566.92. About 5.8 billion shares worth Rp 4.4 trillion ($489.7 million) changed hands. Gainers beat decliners 154 to 70.

The most active stock by value, Medco Energi Internasional, Indonesia’s largest listed oil company, surged 15 percent to Rp 4,225, its steepest increase since February 2009.

State-run Pertamina said on Sunday that it had signed an agreement to buy Encore International, giving Pertamina a 27.9 percent stake in Medco.

Aneka Tambang, a state-run nickel producer, fell 3 percent. Timah, Indonesia’s largest tin producer, lost 5.3 percent, making it the biggest loser on the Jakarta Mining Index on Monday.

Nickel futures fell 2 percent to $23,550 a metric ton in London while tin lost 1 percent to $26,450 a ton.

Astra Agro Lestari, the country’s largest listed plantation company, fell 1.9 percent.

Palm oil futures declined 1.1 percent to 2,897 ringgit ($935) a metric ton in Kuala Lumpur trading, on pace for the biggest drop since Oct. 4. Astra Agro plants only oil palm trees.

Fajar Surya Wisesa, a producer of container boards, boxboard and coated paper, rose 6.9 percent to Rp 3,100, the biggest gain since Sept. 30.

Fajar said nine-month net income rose 44 percent from a year earlier to Rp 256 billion.

Meanwhile, the rupiah retreated from near its highest level in three years, falling 0.2 percent to trade at 8,928 per dollar as of the stock market close on Monday, on concern that policy makers will intervene to limit exchange-rate volatility.

The currency has advanced 5.2 percent this year, after climbing 16 percent in 2009.

“BI has been supporting the dollar in the market,” said Gundy Cahyadi, an economist at Oversea-Chinese Banking Corp. in Singapore.

“At any point as the rupiah weakens slightly, people will push for it to get stronger.

The market is just going to continue to test the central bank’s resolve” in keeping the rupiah at between 8,920 and 8,925, he said.

Central banks nudge currency markets by arranging purchases or sales of foreign exchange.

In Manila the Philippine Stock Exchange index trimmed down some of its intra-day losses to finish at 4,215.11 or just 0.02 percent lower from Friday’s close. The composite index was down by as much as 4,187.83 before investors started positioning on some of the issues.

Likewise, the broader all-share index slipped by 0.09 percent or 2.42 points to 2,682.22, although the industrial and the holding firm sectors bucked the trend.

Trading volume reached only 1.32 billion shares worth 4.35 billion pesos with 90 issues declining, 48 advancing and 43 were unchanged.

“Philippine shares failed to sustain early gains, falling in line with trends across the Asia Pacific region (because of the dollar’s slight improvement),” Justino Calaycay, an analyst of Accord Capital Equities Corp., said in his daily stock market comment.

The Asian markets have been rallying because of the weak dollar that sent investors positioning in riskier assets. As of this afternoon, selling was across all Asian equities.

For the Philippines, the market’s recent favorites such as Ayala Land, Inc., Alliance Global Group, In. and heavyweight Philippine Long Distance Telephone Co. all finished in the negative.

Stocks on Bursa Malaysia fell 0.61% to close at 1480.70 points as the Budget announcement failed to give much of a lift to sentiment, tracking losses in Asian equity markets.

Losers TNB (-11 sen to RM8.82), AXIATA (-5 sen to RM4.48), GENT (-10 sen to RM10.10), MISC (-14 sen to RM8.56) and IOI (-5 sen to RM5.75).

Winners were PPB (+8 sen to RM18.16), GENM (+1 sen to RM3.53), YTLP (+1 sen to RM2.34) and PETD (+2 sen to RM10.94). Market breadth was negative with 299 gainers as compared to 468 losers.

The benchmark FBM KLCI began the day in positive territory but lost momentum as investors opted to lock in recent gains. The Finance Index lost 0.39% to 13362.15 points, the Properties Index eased 0.34% to 956.14 points and the Plantation Index rose 0.14% to 7376.64 points.

The market traded within a range of 16.06 points between an intra-day high of 1494.96 and a low of 1478.90 during the session. Actively traded stocks include KBUNAI, TIMECOM, MALTON, PLUS, L&G, TIME, GWPLAST, GAMUDA-WD, YTLE and HWGB.

Trading volume increased to 1330.54 mil shares worth RM1610.37 mil as compared to Friday’s 1020.98 mil shares worth RM1646.53 mil.

The Stock Exchange of Thailand (SET) composite index on Monday dropped 13.12 points or 1.32 per cent to close at 984.03 points. The market value was 31.36 billion baht, with 5.55 billion shares traded.

PTT Plc plan to reap the benefits of a stronger baht by accelerating their investment plans and debt repayments making PTT a strong buy in this falling market.

Nuttachat Charuchinda, PTT’s senior executive vice-president for corporate strategy, said the oil and gas conglomerate was taking another look at its five- and 10-year investment plans to decide which projects to speed up.

“We’re looking at planned foreign investments of PTT Exploration and Production and PTT International. These could be either greenfield projects or mergers and acquisitions, basically in upstream petroleum activities such as oil and gas exploration,” he said. Top five most active values were as follows;

PTT closed at 308.00 baht, down by 5.00 or 1.60 per cent.

CPF closed at 23.00 baht, down by 0.70 or 2.95 per cent.

PTTAR closed at 29.25 baht, down by 1.50 or 4.88 per cent.

PTTEP closed at 169.00 baht, down by 5.00 or 2.87 per cent.

TMB closed at 2.42 baht, down by 0.02 or 0.82 per cent.

Singapore fell 23 points or 0. 72 percent on Monday with the benchmark Straits Times Index (STI) closing at 3,181.27 points.

Singapore said its economy could experience a technical recession in the second half of 2010 even as the island remains “on track” for an expansion of 13 percent to 15 percent for the full year.

Singapore’s economy will moderate in the second half of 2010 and next year, S. Iswaran, senior minister of state for trade and industry, said in parliament today. A technical recession is two consecutive quarters of economic contraction.

Singapore’s export growth slowed in September as shipments of electronics and pharmaceuticals eased, heralding softening demand in the coming months as the global economy weakens.

Non-oil domestic exports climbed 22.7 percent from a year earlier, after a revised 30.8 percent gain in August, the trade promotion agency said in a statement in Singapore today. The median forecast of 14 economists surveyed by Bloomberg News was for an increase of 19.7 percent.

Overseas demand, which has lifted export-dependent Asian economies including Singapore and China, may falter as governments in Europe embark on austerity programs to cut deficits and households in some of the world’s largest economies hold back spending.

Singapore’s economy contracted last quarter as manufacturing cooled, a report showed this month.

The overall volume stood at 2.29 billion shares worth 2.67 billion Singapore dollars (about 2.05 billion U.S. dollars).


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