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ASEAN STOCK WATCH Asean Affairs   14 September  2011

Asean Stock Watch- September 14



U.S. stocks rallied to close up amid volatile trading with investors cautious over Euro zone debt crisis and the U.S. economy.

The Dow Jones Industrial Average rose 44.73 points, or 0.40 percent, to close at 11,105.85. S&P 500 rose 10.60 points, or 0.91 percent at 1,172.87.All 10 S&P sectors finished higher, led by industrials and materials.

Nasdaq composite gained 37.06 points, or 1.49 percent at 2,532.15.


Stocks suffered their biggest drop in two weeks on Monday, on fears that a default by Greece would deepen Europe’s financial crisis and plunge the global economy into recession.

The Jakarta Composite Index plunged 102.38 points, or 2.6 percent, to close at 3,896.12, the largest drop since Aug. 19. About 3.7 billion shares were traded, worth Rp 3.3 trillion ($382.8 million). Decliners far outnumbered gainers by 222 to 32. Foreign investors sold Rp 271 billion more than they bought in shares.

“Confidence in the market is shaken. As long as there is no certainty in Greece’s economic recovery, the volatility will continue,” said Betrand Raynaldi, head analyst at eTrading Securities.

Concerns about a Greek default rose last week after senior politicians in German Chancellor Angela Merkel’s center-right coalition started talking openly about it, Reuters reported.

Greece confirmed on Monday that the country has cash for only a few more weeks, saying on the same day that it had set a new property tax as part of its austerity measures.

Betrand said market volatility might continue for the rest of the week as European policy makers had yet to decide on fresh funding to help the ailing country.

“I believe that Europe will help Greece because they cannot afford the nation to fail,” he said, adding that a Greek default would trigger a contagion in euro zone countries.

The volatility in the market kept investors away and trade value was low. The Rp 3.3 trillion traded on Monday was 37 percent lower than the Rp 5.27 trillion daily average this year.

Cigarette manufacturer Gudang Garam shed 4.3 percent to Rp 57,250, while rival HM Sampoerna fell 1.8 percent to Rp 32,250. The government plans to increase the excise tax on cigarettes by 12.2 percent this year, which would put pressure on tobacco companies’ profit margin.

The tumble by cigarette makers contributed to a 3 percent loss for the consumer goods sector.

Berlian Laju Tanker, a shipping services company, fell 3.4 percent to Rp 245, after reporting on Monday that its first-half net profit dropped 11 percent to $22 million from a year earlier.

Tambang Batubara Bukit Asam, a state-controlled coal miner, shed 2.3 percent to Rp 19,250. Bayan Resources, a coal producer, lost 0.9 percent to Rp 21,750. The price for crude oil fell 1.5 percent on Monday.

“This is still within normal range. I don’t see this as a sign of big money pulling out of the country,” Betrand said.


Share prices on Bursa Malaysia open Wednesday in the blue territory following overnight gains in the Wall Street amid easing debt concerns in Europe, dealers said.

After 15 minutes of trading, the benchmark FTSE Bursa Malaysia KLCI was up 4.75 points to 1,452.75. It had opened 5.04 points higher at 1,453.04.

They said rumours that China was looking to buy some Italian bonds outweighed concerns about the prospect of a default by Greece.

Technology stocks are expected to move higher, along with financials and steel companies," they added.

Meanwhile, HwangDBS Vickers Research said the local bourse was expected to show a mixed market breadth today, with its benchmark FBM KLCI likely to swing sideways inside a narrow trading range in the absence of market-moving news.

"There was no visible lead from Wall Street last night as major US equity indices finished slightly up by between 0.4 per cent and 1.5 per cent on hopes that the European sovereign debt crisis would not worsen," it said.

On the local bourse, the Finance Index rose 21.59 points to 13,493.41; the Plantation Index added 56.78 points to 7,326.79; and the Industrial Index gained 5.78 points to 2,677.69.

The FBM Emas Index added 35.74 points to 9,916.03; the FBM Mid 70 Index advanced 63.99 points to 10,738.87; and the FBM Ace Index rose 9.66 points to 3,790.87.

The market breath was positive, with gainers outpacing losers by 113 to 37, while 82 counters were unchanged; 1,257 untraded; and 29 others suspended.

A total of 20.57 million shares worth RM24.88 million were traded.

Among active stocks, Takaso Resources rose half a sen to 21 sen; Takaso RES BHD-WA added half a sen to 7.5 sen; and Flonic Hi-Tec also gained half a sen to 14 sen.

Of the heavyweights, Maybank added one sen to RM8.61; CIMB was up three sen to RM7.08; and Sime Darby rose one sen to RM8.71.


Philippine share prices on Tuesday closed slightly lower amid lethargic trading as concerns over the European sovereign debt crisis prompted investors to stay on the sidelines.

At the Philippine Stock Exchange, the composite index dipped 4.94 points, or 0.11 percent to 4,292.91, while the broader all-shares index lost 7.38 percent, or 0.24 percent to 3,027.23.

Losers beat decliners, 84 to 62, while 48 stocks were flat. A total of 6.52 billion stocks worth P2.49 billion changed hands.

“Since breaking its 4,300 support yesterday, the index looks set for another sideways move as troubles continue to unfold in major markets abroad,” said Maria Arlysa Narciso of AB Capital Securities Inc.

“Stocks which were actively traded in the previous days pulled back, causing the index to lose its footing further,” added Narciso, citing recent favorite Philex Mining Corp., which declined by 4.24 percent to P25.95.

Overnight, Wall Street had a late afternoon rally after investor concerns over the European Union’s sovereign debt crisis eased on reports that Italy, potentially the fourth European economy on the brink of default, could get financial support from China.

The Dow Jones Industrial Average climbed 68.99 points, or 0.6 percent to close at 11,061.12 for only its second gain this month.

The PSEi is seen to move within a tight range on Wednesday in the absence of catalysts to lift the index higher.

“Third liners will most likely be active if performance of major markets tonight turns weak. Investors will stick to small caps while also looking into defensive stocks,” said Narciso.

Jun Calaycay of Accord Capital Equities Corp. advised investors to beef up equity portfolios as the index continued to hold its critical support line despite failed attempts to break resistance levels.

“This is a welcome behavior in the context of the wide and negative volatility in overseas markets. Ours is a situation where sensitivity to the negatives appear to have been tamed and the market is just waiting for a positive push,” Calaycay said.

“We may of course see a strong knee-jerk, particularly if Greece’s default becomes a fact and Europe drags global economies back into a recession,” he added.

Asian currencies were mixed Tuesday, but the peso continued to weaken amid disappointing export numbers in July.

At the Philippine Dealing System, the peso shed 16 centavos to close at 42.975 against the US dollar from 42.815 the previous trading day.

The dollar-peso pair opened at 42.875 and moved to a high of 42.990 and to a low of 42.710, ending the morning session at an average of 42.816.

Total trading volume eased to $775.800 million compared with $921.700 million on Monday.

The currency pair is expected to remain volatile for the rest of the week and is likely to trade within the 42.20 to 43 range, with bias leaning on a weaker peso.


Singapore shares opened higher on Wednesday, with the benchmark Straits Times Index at 2,759.68 in early trade, up 1.11 percent, or 30.31 points.

Around 69.2 million shares exchanged hands.

Gainers beat losers 137 to 19.


Thai composite stocks index (SET) closed on Tuesday at 1,031.67, down 9.16 points, or 0.88 percent amid Baht 20.54 billion turnover.

Blue chip SET-50 index was at 716.87, down 6.43 points, or 0.89 percent.

Top five active (value) stocks: PTT, ADVANCE, KBANK, BBL, PTTCH.


Domestic gold prices on Tuesday rose VND1 million (US$48.3) higher than on the international market with gold traders posting their selling prices at VND47.1-47.6 million (around $2,300) per tael (one tael equals 1.2 troy ounces).

Securities also recovered.

Gold futures for December delivery in the New York market on Monday's trade dropped $46.20 to $1,813.30 per ounce after three straight days of increases.

Bloomberg said investors sold to cover equity losses.

Global stocks yesterday recovered after slumps and the domestic market was able to maintain its two-week rally.

"The expectation that inflation will rise this month may help extend the rally," stated Vietcombank Securities Co analyst Tran Minh Hoang.

Closing yesterday's session at 469.40 points, the VN-Index on the HCM Stock Exchange added 1.4 percent.

Advancers outnumbered decliners by 229-39.

The value of trades reached nearly VND1.2 trillion ($58 million), up 39.1 percent compared to Monday's figure while the trading volume increased by 16.2 million shares to 68.4 million.

Among blue chips, insurer Bao Viet Holdings (BVH), food processor Masan Group (MSN) and PetroVietnam Finance (PVF) continued to hit their ceiling prices, while real estate developer Vincom (VIC) bottomed out for the second day in a row.

Saigon Securities Inc (SSI) was the most active code with nearly 4 million shares exchanged.

On the Hanoi Stock Exchange, the HNX-Index closed up 0.9 percent at 79.25 points.

"The amplitude of the index was narrower as the sell pressure got higher, which nearly dragged the index down," said Tan Viet Securities Co analysts.

The market value slid 4.6 per cent from Monday's level to VND771.3 billion ($37.3 million).



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