ASEAN KEY DESTINATIONS
Asean Stock Watch- October 20
The Dow Jones Industrial Average slumped 72.43 points, or 0.63 percent, to close at 11,504.62 following news that talks on euro zone debt solution between France and Germany have stalled ahead of EU summit this weekend.
The S&P 500 slid 15.50 points, or 1.26 percent at 1,209.88. Most S&P sectors finished in the red, led by materials and techs. Utilities finished slightly higher.
The Nasdaq composite fell 53.39 points, or 2.01 percent at 2,604.
At 9:01a.m., the FTSE Bursa Malaysia KLCI (FBM KLCI) declined 11.88 points to 1,438.37, after opening 5.07 points lower at 1,445.18.
The Finance Index dropped 18.93 points to 13,120.37, the Industrial Index decreased 17.84 points to 2,637.70 and the Plantation Index slipped 7.37 points to 7,315.43.
The FBM Emas was down by 26.07 points to 9,851.57, the FBMT100 lost 65.54 points to 9,634.67 and the FBM70 decreased 15.25 points to 10,586.86 while the FBM Ace rose 12.23 points to 4,026.09.
Losers led gainers by 83 to 5l while 74 counters were unchanged.
Volume stood at 294,388 lots valued at RM12.284 million.
For the active counters, JCY International shed half sen to 57.5 sen while Jotech-WA edged up by one sen to 6.5 sen, followed by Ulicorp which added 5.5 sen to 82.5 sen.
Among heavyweights, Maybank decreased four sen to RM8.20, CIMB and Petronas Chemicals shed two sen each to RM7.21 and RM6.10 respectively, followed by Sime Darby which slipped nine sen to RM8.56.
At the Philippine Stock Exchange, the composite index added 36.29 points, or 0.87 percent to 4,193.55, while the broader all-shares index added 18.38 points, or 0.63 percent to 2,948.55.
“Sentiments by and large remain tied up to Europe’s fate, as most global equity markets are, with the decent numbers posted by the domestic economy lending stability,” said Jun Calaycay of Accord Capital Securities Corp.
Overnight, the Dow Jones Industrial Average rebounded from a similar one-day loss, rising 180.05 points, or 1.6 percent to 11,577.05 after France and Germany agreed to expand the rescue fund.
“Unless other negatives arise in the final two sessions, we expect a breach of the 4,200-resistance which will invite more flow in addition to the technical-induced and bargain-hunting inspired ones we currently experience,” said Calaycay.
Stocks wiped out more than half of the previous session’s low, a validation of the 4,130-technical support but still failing to close above the 4,200 mark.
“It tells us that the local market has ‘substance’ and the gyrations result from sentiments borrowed from overseas – an influence no nation can actually escape from in this age of globalization where the distinction between economies are blurred,” said Calaycay.
“What we confidently contend is that we have achieved a certain degree of economic strength to keep and see us through this still developing crisis. These strengths will become even more a positive influence if and when, and we see it as inevitable, the crisis is resolved,” he said.
At the Philippine Dealing System, the peso closed at 43.155 to the US dollar, up 13.5 centavos from 43.290 during the previous trading.
The dollar-peso pair opened at 43.200 and moved to a high of 43.20 and to a low of 43.140.
Total trading volume reached $916.79 million from $1.005 billion on Tuesday.
About 40.3 million shares exchanged hands.
Losers beat gainers 84 to 33.
The Stock Exchange of Thailand index closed at 938.19 points, down 14.56, in thin trade worth 19.47 billion baht.
Bank stocks fell 3.85 percent, property stocks lost 3.14 percent while construction materials lost 0.71 percent.
The sell-off, which came on top of a 1.94 percent loss for the SET index on Tuesday, came despite positive news from Europe that France and Germany had agreed to expand a euro zone rescue fund to 2 trillion euros.
The reports, which offset the announcement that Moody's had cut Spain's credit rating, helped push Tokyo stocks up yesterday by 0.35 percent, Sydney 0.64 percent and Hong Kong 1.29 percent.
But the losing battle to keep flood waters out of Bangkok outweighed positive sentiment overseas. Authorities yesterday cautioned residents in seven Bangkok districts to prepare for evacuation due to flooding.
Flooding has already claimed 315 lives, destroyed millions of tons of crops and inundated key industrial manufacturing areas in Ayutthaya, Nonthaburi and other provinces.
The government this week estimated that economic growth this year could slow by up to 1.7 percentage points to just 2 percent as a result of damage from the floods.
SET president Charamporn Jotikasthira said listed companies were likely to begin reporting damage from the floods from their fourth-quarter financial reports, with sectors such as electronics, automobiles and industrial estate operators among the hardest hit.
He added that the SET was preparing to launch a 500-million-baht investment fund to assist flood-hit farmers, with the exchange providing half of the seed capital.
SET chairman Sompol Kiatphaibool said listed companies hit by the floods could take three to six months to fully repair their damage.
He said most businesses in the electronics and automotive sectors were fully insured for losses, but would take time to repair affected machinery and restart their production lines.
"Right now, the greatest concern I think is the impact on public utilities, including power, water and roads. The government must move quickly to repair the damage to help restore confidence," Mr Sompol said.
Manufacturers including Western Digital, Kubota, Minebea, Honda, Nissan and Mazda have all closed factories and warned of declining exports and production due to the floods.
Finansia Syrus Securities said the floods have not only disrupted domestic manufacturing, but also supply chains to Malaysia, Japan and Singapore.
One concern in the longer term is whether the floods may lead some foreign investors to shift manufacturing to China or Vietnam, the broker said.
Thai Reinsurance, which announced it would set aside 260 million baht in reserves to cover flood losses in the fourth quarter, has seen its share price fall by 20% this month. The stock closed yesterday at 5.30 baht, down 2.75 percent, in trade worth 4 million baht.
Today's trading was sluggish with just over 24.2 million shares, worth VND395.3 billion (US$18.8 million), changing hands.
Gainers inched up over losers 101-98 but blue chips tumbled as none of the 10 largest shares by market capitalisation increased.
Shares posting gains today were mostly penny stocks such as An Giang Seafood Import-Export (AGF), Binh Dinh Minerals (BMC), insurer Bao Minh Co (BMI), Dong Phu Rubber (DPR), Long An Food Processing & Export (LAF) and Vimedimex Medi-Pharma (VMD).
Becamex Infrastructure Development (IJC) was the most active code in HCM City today, with 1.9 million shares traded, though share price closed down 1 per cent to VND9,600 ($0.46).
Shares rebounded in the closing minutes of the Hanoi Stock Exchange, with the HNX-Index inching up just 0.18 percent over yesterday to close at 67.93.
Advancers outnumbered decliners by 140-86 but the market value fell slightly to VND256.6 billion ($12.2 million) with 25.5 million shares traded.
Kim Long Securities Co (KLS) remained the most heavily traded stock nationwide with nearly 2.4 million shares changing hands. It rose 1 per cent to close today's session at VND10,100 ($0.48).
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