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ASEAN STOCK WATCH 2  October  2010

ASEAN Markets Weekly Report

Shayne Heffernan

In Singapore the exchange closed higher on Friday, with the benchmark Straits Times Index at 3,130.9, up 1.07 per cent, or 33.27 points.

About 1.77 billion shares exchanged hands.

Gainers beat losers 370 to 121.

Among the gainers, commodities firms Noble Group rose 2.6% to S$1.94 while Olam International gained 1.5% to S$3.31.

Stocks of property developers also found buyers despite government data showing a moderation in private property prices for the third quarter.

According to the Urban Redevelopment Authority’s (URA) initial estimates, Singapore’s private residential property prices rose 3.1% in the third quarter, slower than the 5.3% quarter-on-quarter gain in the previous quarter.

Among developers, CapitaLand rose 1.5% to S$4.12 while City Development was up 0.9% at S$12.88.

The Stock Exchange of Thailand (SET) composite index on Friday gained 3.28 points or 0.34 per cent to close at 978.58 points. The market value was 37.43 billion baht, with 6.15 billion shares traded.

Top five most active values were as follows;

IRPC closed at 4.40 baht, up 0.24 baht or 5.77 per cent.

PTTEP closed at 158.00 baht, up 4.00 baht or 2.60 per cent.

PTT remained at 297.00 baht.

KTB closed at 17.40 baht, up 0.40 baht or 2.35 per cent.

PTTAR closed at 27.75 baht, up 0.25 baht or 0.91 per cent.

In Manila the Philippine Stock Exchange index added 11.89 points or 0.29 percent to close at 4,111.99.

The day’s gains were led by the mining/oil and property sectors, which rose by 2.47 percent and 1.9 percent, respectively. Only the counter for holding firms traded in the red.

Advancers led decliners 94-40, while 38 stocks were unchanged.

Momentum eased as value turnover thinned to P4.14 billion, falling below P5 billion for the first time in over a month. Foreign investors remained in a net foreign buying position, but at a modest level of P45 million.

Dealers said the local market had most likely entered a consolidation phase after a recent bull run to record levels. By this time, many investors are mulling over which stocks to unload, hold or accumulate.

The two most actively traded stocks were blue chips Philippine Long Distance Telephone Co. and SM Investments Corp. Investors. Investors loaded up on shares of Energy Development Corp., Metro Pacific Investments Corp. and Ayala

The economy is expected to grow by 8 percent this year due to favorable conditions that are seen to benefit emerging markets, according to Barclays.

The international finance institution recently upgraded the country’s growth forecast, a tad higher than the government’s official target. It was the third time Barclays raised its forecast for the Philippines. In August, it announced that the economy would grow by 7 percent. Earlier in the year, it projected a 4.3 percent rise.

For 2011, the Philippines may grow by 5 percent, Barclays said, taking into account base effects arising from the economy’s strong performance this year.

Also, the finance institution said inflation in the country would remain manageable. It sees consumer prices rising this year and the next by only 3.7 percent, which is considered to be tolerable.

In its latest paper, “Global Outlook: Nothing More than a Pause,” the financial services firm said that the global economy appeared to have a tough time sustaining its recovery.

In particular, the debt crisis in the Euro zone and the sluggishness of the US economy continue to threaten the world economy, the firm said.

Europe and the United States are major export markets for many developing countries like the Philippines.

“The slowdown in the global economy … has generated concerns that recovery is in jeopardy. We believe these concerns are largely misplaced and that the odds of a renewed recession are remote,” Barclays said.

It expects the world economy to grow by an average of 4.5 percent this year as stimulus measures implemented by governments across the globe help lift industrialized economies out of recession.

Stimulus measures include higher public spending by governments and reduction of key interest rates by central banks. Low interest rates tend to spur demand for bank loans, promoting consumption and investments.

“By our estimates, global economic growth is likely to register more than 4.5 percent this year—a very respectable showing comparable to the boom years of 2004-2007. We are projecting a slower pace of growth after that [in 2011], but still in excess of 4 percent,” Barclays said.

In Kuala Lumpur, Bursa Malaysia rose 0.19% to close at 1466.32 points as investors as investors remained keen on blue chip stocks.The market traded within a range of 5.42 points between an intra-day high of 1469.77 and a low of 1464.35 during the session.

Most Active were stocks include KBUNAI, TEBRAU, TIME, ZELAN, GENS-C8, UEMLAND, SAAG, GAMUDA-WD, RAMUNIA and GENM-CL. Winners AXIATA (+7 sen to RM4.45), GAMUDA (+10 sen to RM3.98), DIGI (+28 sen to RM24.58), MMC (+12 sen to RM3.12) and GENTING (+4 sen to RM9.96).

Losers (-4 sen to RM8.13), AMMB (-8 sen to RM5.85), MISC (-7 sen to RM8.67), MAXIS (-2 sen to RM5.33) and YTL (-4 sen to RM7.46). Market breadth was positive with 422 gainers as compared to 327 losers.

The Finance Index fell 0.04% to 13348.27 points, the Properties Index climbed 0.21% to 917.92 points and the Plantation Index added 0.30% to 6812.68 points.

Trading volume declined to 973.82 mil shares worth RM1469.17 mil as compared to Thursday’s 1051.79 mil shares worth RM1718.16 mil. In Jakarta Indonesia the JCI rose 45.82 points, or 1.3 percent, to close at 3,547.12, its first close above the 3,500 level. Volume was heavy, with 6.7 billion shares worth Rp 5.01 trillion ($561.1 million) changing hands.

Gainers outnumbered decliners 158 to 62. The JCI gained 4.4 percent on the week.

Consumer prices climbed 5.8 percent from a year earlier in September, compared with an increase of 6.4 percent in August, the government said on Friday.

Meanwhile, a drop in US jobless claims and better-than-expected Chinese manufacturing data boosted sentiment in Asia.

Astra International, the country’s biggest auto retailer, jumped 5.1 percent to Rp 59,600, its highest level since August 1991, after the company said it would pay an interim dividend of Rp 470 a share, the most since at least 2002.

Finance stocks were led by Bank Central Asia, the country’s biggest bank by market value, which surged 4.5 percent to Rp 7,000, its highest close since its trading debut in May 2000.

Financial socks climbed after September’s consumer price index rose less than expected, easing pressure on the central bank to increase borrowing costs.

Coal miner Bumi Resources climbed 4.7 percent to Rp 2,225.

Bumi sold $700 million of US dollar-denominated debt maturing in 2017.

The 10.75 percent debt, issued through Bumi Investment, was priced at par.

Retailer Matahari Putra Prima jumped 24.21 percent to Rp 1,180, its steepest increase since Aug. 5.

The company said first-half net income surged to Rp 5.6 trillion from Rp 130.4 billion a year earlier, bolstered by a one-time gain. Unilever Indonesia advanced 1.5 percent to close at Rp 17,100.

The rupiah changed little on Friday after touching 8,900 against the dollar on Thursday, its strongest level in more than three years.

The rupiah strengthened for a second week, edging up 0.4 percent, to trade at 8,918 per dollar when the stock market closed on Friday.

The rupiah gained 1.7 percent during the third quarter.

Overseas investors bought $2.3 billion more Indonesian shares than they sold in the first nine months of the year to benefit from accelerating growth in Southeast Asia’s largest economy.

“The reason the rupiah is getting stronger is that Indonesia’s economic indicators are improving,” said Lindawati Susanto, head of foreign-exchange trading at Bank Resona Perdania in Jakarta.

“We are continuing to see inflows into Indonesian assets in line with the rest of the region. The government intends to guard against volatility in the rupiah.”


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