ASEAN KEY DESTINATIONS
Asean Stock Watch- September 21
U.S. stocks closed mixed in thin trade overnight, following a report that no deal has yet been reached on Greece and investors waited for outcome of a Federal Reserve two-day meeting on interest rate policy
The Dow Jones Industrial Average closes up 0.07 percent at 11,408.66, while S&P 500 fell 2.01 points, or 0.17 percent, to end at 1,202.08. Among key S&P sectors, materials and industrials sagged, while utilities gained.
The Nasdaq fell 22.59 points, or 0.86 per cent, to end at 2,590.24. Meanwhile, European shares closed higher as investors await the U.S. Federal reserve's latest decision on interest rate policy.
Indonesia’s benchmark stock index closed slightly lower on Tuesday following a sharp rebound in afternoon trading as European markets opened positively and US futures rose.
The Jakarta Composite Index lost 2.94 points, or 0.1 percent, to close at 3,752.11, trimming an intraday decline of as much as 2.2 percent. About 4.61 billion shares, valued at Rp 4.72 trillion ($533 million), changed hands.
Decliners beat gainers, 118 to 98. Foreign investors, who typically make up about two-thirds of total daily trading, sold Rp 785 billion more in shares than they purchased.
Mastono Ali, an analyst with CIMB Securities Indonesia, said that the index rallied in the second trading session as European markets opened higher and Dow Jones futures improved, even as concerns about Europe’s debt crisis persist.
The US Federal Reserve on Tuesday began a two-day meeting, and the market is anticipating that policy makers will announce a stimulus package to boost economic growth in the United States, which would help to avert a global slowdown.
“To rise from the lowest point at 3,673 to close at 3,752 is pretty remarkable, and I think the positive sentiment will stay until tomorrow,” Mastono said.
Bank Central Asia, the largest capitalized banking stock, gained 1.3 percent to Rp 7,950, while Bank Rakyat Indonesia, the second-largest bank by assets, gained 0.8 percent to Rp 6,200. BCA had lost 2.5 percent in a week to Monday, while BRI dropped 6.8 percent over the same period.
“The finance sector was hit pretty hard in the past few days, and investors are now looking for stocks that are cheap,” Mastono said.
Jaya Agra Wattie, a rubber plantation company, fell 3.6 percent to close at Rp 400. Rubber futures in Tokyo fell on worries of Greece defaulting on and Italy’s credit being downgraded by Standard & Poor’s, Reuters reported.
Chandra Asri Petrochemical, the largest listed petrochemical company, lost 6.8 percent to Rp 3,750. The company announced that SCG Chemicals of Thailand bought a 30 percent stake in Chandra for Rp 4,088 a share.
The FBM KLCI ended lower by 2.48 points at 1,410.64 on Tuesday with the FBMACE down 6.97 points at 3,690.72 and the FBME masshed 42.88 points at 9,583.85. Turnover was 784.626 million shares done valued at RM1.417bil. There were 230 gainers, 457 losers and 301 stocks unchanged on Bursa Malaysia. Meanwhile, some regional peers ended higher with Shanghai SE Composite up 0.41 percent to 2,447.76, Kospi up 0.94 percent to 1,837.97 and Singapore's STI up 0.89 percent to 2781.86.
Philippine share prices and the peso slumped on Tuesday, pulled down by the credit rating downgrade of Italy and the absence of new solutions to the euro zone’s debt problems.
A day after returning above the 4,300-level, optimism was sapped with the market bleeding soon after the opening bell rang.
At the Philippine Stock Exchange, the composite index tumbled 88.17 points, or 2.05 percent to 4,219.82, while the broader all-shares index lost 50.52 points, or 1.66 percent to 2,989.36.
Decliners paced advancers, 113 to 39, while 32 stocks were unchanged. A total of 9.72 billion stocks worth P3.82 billion changed hands.
“Stocks fell across-the-board and across the Asian region Tuesday with sentiments pulled by fears Greece may go into default while Italy’s rating was downgraded a notch by Standard and Poor’s,” said Jun Calaycay of Accord Capital Equities Corp.
Still reeling from concerns of a possible default by Greece, debt-ridden Europe suffered another blow following the credit rating downgrade on Italy from A+ to A, adding to the growing pessimism of investors.
“Overall, markets need to be reassured funding sources can be extended to control the contagion. Having dropped below 4,300, another cautious atmosphere might prevail until industrialized markets detail a specified economic fix, more than providing assurance,” said Freya Natividad, investment analyst at 2TradeAsia.com.
For the rest of the week, global portfolio managers are expected to highlight time variables for industrialized markets to gradually resolve their present economic impasse, Natividad added.
The US Federal Reserve will hold a two-day policy meeting beginning Tuesday night on how to boost their sputtering economy. Expectations suggest that the Fed will try for the third time to strengthen growth by buying Treasuries to bring down long-term interest rates.
“If stability is achieved in Europe, even short term, and if the US becomes successful in implementing its strategies, then markets can at least find some reprieve,” said Maria Alrysa Narciso of AB Capital Securities Inc.
Investors are advised to “stick to the fundamentals” given that even short-term plays appear to have lost most of their luster, said Calaycay.
At the Philippine Dealing System, the peso shed two centavos to close at 43.460 against the US dollar from 43.440 the previous trading day.
“S&P downgraded its unsolicited ratings on Italy by one notch to A/A-1 and kept its outlook on negative, a major surprise that threatens to add to concerns of contagion in the debt-stressed euro zone. The move from S&P came as a surprise as the market had thought Moody’s was more likely to downgrade Italy first,” an analyst from the Metropolitan Bank and Trust Co. said in a commentary.
The dollar-peso pair opened at 43.540, with bids ranging from a high of 43.700 to a low of 43.460. It fetched an average of 43.639 to a dollar at the end of the morning session.
Total trading volume surged to $1.567 billion from $827.90 million on Monday.
The currency pair is expected to trade at a range of 42.900 to 43.600 within the week, with the Bangko Sentral ng Pilipinas present to smoothen volatility.
Singapore shares opened lower on Wednesday, with the benchmark Straits Times Index at 2,767.34 in early trade, down 0.49 percent, or 13.50 points.
Around 49.9 million shares exchanged hands.
Losers beat gainers 83 to 41.
The Stock Exchange of Thailand main index went up 9.09 points or 0.89 percent to close at 1,026.28 points at the end of trading session on Tuesday. The trade value was 19.73 billion baht, with 2.28 billion shares traded.
The SET50 index ended at 714.70 points, up 7.83 points or 1.11 percent, with a total trade value of 15.90 billion baht.
The SET100 index rose 15.70 points or 1.02 percent to stand at 1,555.55 points, with a total turnover of 17.78 billion baht.
The SETHD index went up 9.78 points or 0.99 percent to stand at 994.86 points, with total trade value of 5.90 billion baht.
The MAI index dropped 3.62points or 1.26 percent to close at 284.50 points, with total transaction value of 478.34 billion baht.
Top five most active values were as follows;
PTTCH closed at 119.50 baht, down 2.50 baht (2.05 percent)
SCC closed at 304.00 baht, up 1.00 baht (0.33 percent)
PTT closed at 310.00 baht, up 4.00 baht (1.31 percent)
TOP closed at 60.75 baht, down 1.00 baht (1.62 percent)
BANPU closed at 626.00 baht, up 8.00 baht (1.29 percent)
Shares fell on the HCM City Stock Exchange on Tuesday, led by slumps in major stocks, with the VN-Index losing 1.58 percent to close the session at 454.37 points.
Influential caps including insurer Bao Viet Holdings (BVH), food producer Masan Group (MSN) and PetroVietnam Finance (PVF) all dropped to the floor price, while steelmaker Hoa Phat Group (HPG) and software producer FPT (FPT) both lost around 2 percent.
A 4-per-cent rise by property developer Vincom (VIC) cushioned the fall, while Phu My Fertiliser (DPM) and dairy giant Vinamilk (VNM) gained by just under 1 percent each.
Over half of the total codes made losses, with trading value declining 35 percent from Monday to just VND886.7 billion (US$42.6 million) or 46 million shares.
Becamex Infrastructure Development (IJC) was again the most active stock on the southern bourse with 2.2 million shares traded, although it closed 3.6 percent down at VND10,800 ($0.52).
It was no surprise to see shares slump yesterday, with many investors fearful of being stuck at a new peak following a 13-day rising streak, according to a Hanoi-based analyst who wished to remain anonymous.
The likelihood of macroeconomic stability in September had supported the stock market, he said, however, after a period of strong rises, the market needed some time to adjust while investors continued to monitor economic news and the effectiveness of new monetary policies.
Bao Viet Securities analyst Tran Hai Yen wrote in a report that the short-term uptrend was not completely broken, but in order to maintain the rally, the market needed more information support.
"Meanwhile, concerns over the possibility that electricity prices will increase in September will accelerate inflation again and may have a negative impact on investor psychology," Yen wrote.
September CPI (consumer price index) in Hanoi was reported to rise just 0.2 percent late yesterday.
In Hanoi, the HNX-Index also slid 2.14 percent to finish the day at 74.38 points, with decliners nearly tripling advancers.
Market value rose nearly 12 percent, however, to nearly VND489.7 billion (US$23.5 million) on a total volume of 42.4 million shares.
Kim Long Securities Co (KLS) was the most heavily-traded stock nationwide with 3.27 million shares changing hands, losing another 0.8 per cent to close at VND12,400 ($0.60).
Foreign investors were net sellers on both exchanges yesterday, unloading a combined VND20 billion ($962,000) worth of shares
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