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ASEAN STOCK WATCH 14  September  2010

ASEAN Markets Setting New Highs

Shayne Heffernan

ASEAN Markets surged forward on Monday and today will see more of the same after strong trading in the USA over night.

The NASDAQ added almost 2% while the Dow was up 1%, expect to see good rallies with some profit taking late in the day across the region today.

As Ebeling Heffernan predicted last week the Philippines Exchange will break 4000 as early as tomorrow morning. The Philippine Stock Exchange index added 69.86 points or 1.79 percent to close at 3,972.60, fueled by a strong foreign buying on local equities.

Value turnover was heavy at P8 billion, indicating strong volume support to this run-up. Net foreign buying amounted to around P2 billion.

The day’s rally was led by the holding firms whose counter surged by 2.89 percent, followed by the industrial, financial and services counters, which respectively surged by 1.73 percent and 1.59 percent.

Advancers overwhelmed decliners 102 to 47 while 35 stocks were unchanged.

The Philippine Long Distance Telephone Co., a laggard in previous sessions, led the day’s gains, followed by Megaworld Corp., SM Investments Corp., Ayala Corp., Banco de Oro Unibank Inc., Energy Development Corp., Universal Robina Corp., Metropolitan Bank & Trust Co. and DMCI Holdings Inc.

On the other hand, Ayala Land Inc. and Alliance Global Group Inc. succumbed to profit-taking.

The Straits Times Index rose 44.53 points to end at 3,066.81, its highest close since June 6, 2008. Shayne Heffernan of Ebeling Heffernan has said the STI will reach 3200 by years end.

Volume was 1.63 billion shares.

Gainers led losers 317 to 177.

DBS Group was up 0.42 per cent at S$14.22, Oversea-Chinese Banking Corp gained 0.92 per cent to S$8.81 while United Overseas Bank fell 0.21 per cent to S$18.72.

Genting Singapore was up 8.7 per cent at S$1.99, Olam International climbed 7.2 per cent at S$2.99, while City Developments bucked the trend, falling 0.2 per cent to S$11.76.

Singapore’s Neptune Orient Lines (NOL), the world’s fifth-largest container shipping firm, said on Monday it carried 13 per cent more containers in the four weeks to Aug 20 compared to a year ago.

NOL said in a statement it shipped the equivalent of 216,900 40-foot containers (FEU) on its vessels in the period, up from 192,800 a year earlier, mainly due to higher shipments on trans-Pacific and Asia-Europe routes.

The average revenue in the period from each container rose to US$3,181, up 45 per cent from a year earlier.

In Kuala Lumpur the FBM KLCI charged up lifted by key blue chips, as fund managers returned after the long weekend break.

At 5pm, the FBM KLCI was up 19.18 points to 1,456.96. There were a total of 542 gainers and 218 losers with 254 stocks unchanged.

As of the afternoon session, PPB Group Bhd and Nestle Malaysia Bhd were among the biggest gainers of the morning session.

It has been a mildly positive week for the global and regional markets, with these markets gaining approximately 1.3% on average.

This could also be prompted by China’s economic data surprising on the upside. Its export growth came in roughly in line with market consensus. It moderated to 34.4% year on year (YoY) in August from 38.1% in July.

Import growth jumped to 35.2% YoY in August from 22.7% in July, suggesting still robust domestic demand. Trade surplus narrowed to US$20.0bil in August from US$28.7bn in July. The ringgit was quoted at 3.1010 to the US dollar.

The Stock Exchange of Thailand (SET) composite index went up 12.47 points or 1.35% to close at 937.04 points at the end of trading session on Monday afternoon. The trade value was 36.81 billion baht.

Bank of Thailand officials plan to meet with local bankers and exporters to hear their views on the changes in rates.

Suchada Kirakul, an assistant governor for the central bank’s Financial Markets Operations Group, said the impact on SMEs is the main concern.

“Regional currencies have appreciated across the board mainly because investors have a positive view on the region,” Mrs Suchada said.

She said some currencies, such as the Taiwanese dollar, the South Korean won and the Philippine peso, have actually appreciated faster than the baht.

The baht, which traded yesterday at 30.74/76 to the US dollar, has appreciated sharply in recent weeks due to capital inflows, the weakness of the greenback and a steady trade surplus.

Mr Korn said a strong currency would affect exporters, although large companies generally were able to mitigate their risk through hedging strategies or by offsetting lower export revenues with cheaper funding or import expenses.

PTT Plc, Thailand’s largest energy firm, has officially submitted a bid for the assets of the French retail giant Carrefour in Southeast Asia worth US$1 billion as it takes steps to expand its retail oil business.

Mr Prasert said PTT Retail Management (PTTRM), the operator of Jiffy retail outlets at Jet petrol stations, was the bidder for Carrefour’s assets.

“If we can acquire Carrefour’s assets, Jet will have a larger scale and gain more bargaining power,” he said.

In the future, Jiffy is expected to expand outside of petrol stations with the retail brands Jiffy Mart and Jiffy Food.

Carrefour has offered to sell its assets in Thailand, Singapore and Malaysia, worth an estimated $1 billion. It is exiting Southeast Asia to focus on markets where it has a leading position.

The race has drawn international retailers such as France’s Casino and Britain’s Tesco as well as regional players such as Dairy Farm, which owns the Giant and Cold Storage chains in Asean.

Top five most active values were as follows;

PTT closed at 291.00 baht, up 3.00 baht (1.04%)

BANPU closed at 656.00 baht, up 12.00 baht (1.86%)

PTTAR closed at 26.75 baht, up 0.75 baht (2.88%)

SCC closed at 326.00 baht, up 16.00 baht (5.16%)

KTB closed at 15.20 baht, up 0.50 baht (3.40%)


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