R e t a i l M a r k e t M o n i t o r Tuesday, 7 February 2017

Transcription

1 MARKET NEWS The FBMKLCI closed marginally higher at 1, (+6.23pt, +0.37%) yesterday, backed by gains in selected blue chips. Meanwhile, Asian shares rose following a rally in US equities as President Trump moved toward looser regulation of the financial industry. The MSCI Asia Pacific Index advanced 0.4%. The FBMKLCI s top gainers were Kuala Lumpur Kepong (+2.7%), Axiata Group (+2.6%) and Petronas Chemicals Group (+2.1%) while the top losers were British American Tobacco (-1.8%), Hong Leong Bank (-1.0%) and Genting Malaysia (-0.99%). In the broader market, gainers outpaced losers 622 to 286 with 341 counters unchanged. Turnover was 2.62b shares valued at RM2.32b. In line with our earlier expectation, the FBMKLCI continued to form a higher high to close at 1, yesterday. The uptick in RSI suggests buying pressure has started to gain traction, which could lead to further upside in the near term. We expect the index will continue the upwards movement towards the psychological resistance level of 1,700. We maintain our support and resistance levels as follows: Support: 1,658,1,651 Resistance: 1,700,1,721 Energy companies led US stock indexes lower on Monday as the price of crude oil declined. Phone company and materials stocks were also among the big decliners. Investors were weighing the latest batch of company earnings news. The DJIA lost 0.09% to settle at 20, and the S&P500 edged lower by 0.21% to 2, The NASDAQ Composite index lost 0.06% to settle at 5, Falling stocks outnumbered advancing ones on the NYSE by 1957 to 1256 and 44 ended unchanged. On the Nasdaq SE, 1575 fell and 934 advanced, while 98 ended unchanged. WHAT S IN THE PACK Technology OSAT: The launch of the new-generation smartphone model in Sep 17 could create a big splash and spur a strong replacement cycle. Globetronics and Inari are key beneficiaries. Ann Joo Resources (AJR MK/BUY/RM2.46/Target: RM2.60) To deliver strong earnings in 2017 on a persistently high ASP and lower coal prices. China s industry consolidation should help local players strengthen their financial muscle. Poh Kong Holdings (PKH MK) Technical BUY on breakout with 21.8% potential return BUY on breakout with a target price of RM0.615 and stop-loss at RM0.48. Based on the daily chart, we can see PKH tried to penetrate the breakout level at RM0.52 and managed to close above the BBI line yesterday. Pesona Metro Holdings (PESONA MK) Technical BUY with +39.7% potential return BUY with a target price of RM0.915 and stop-loss at RM0.58. On yesterday s movement, PESONA managed to penetrate the breakout level of RM0.65 and closed higher at RM Chee Wah Corporation (CWAH MK) Technical BUY on breakout with +20.1% potential return BUY on breakout with a target price of RM1.61 and stop-loss at RM1.21. Based on the daily chart, CWAH formed a series of higher highs and higher lows that indicates an uptrend pattern. FBMKLCI CHART Source: Bursa Station KEY INDICES Prev Close Chg (%) YTD (%) DJIA 20, (0.09) 1.47 S&P 500 2, (0.21) 2.40 FTSE 100 7, (0.22) 0.41 CSI 300 3, FSSTI 3, HSCEI 9, HSI 23, JCI 5, KLCI 1, KOSPI 2, Nikkei , (0.72) SET 1, TWSE 9, BDI (2.26) (23.52) CPO (RM/mt) 3, (1.32) Nymex Crude (US$/bbl) (2.74) TOP VOLUME Stock Price (RM) Chg (%) Vol ( 000) Hibiscus Petroleum ,720 Borneo Oil Bhd ,993 Sterling Progress Bhd ,529 Sumatec Resources ,803 Ifca Msc Bhd ,102 TOP GAINERS Stock Price (RM) Chg (%) Vol ( 000) Sterling Progress Bhd ,529 Scomi Engineering ,750 Netx Holdings Bhd Scomi Group Bhd ,078 Tatt Giap Group Bhd TOP LOSERS Stock Price (RM) Chg (%) Vol ( 000) Berjaya Media Bhd 0.25 (13.79) 0.5 Yfg Bhd 0.04 (12.50) 1,086.3 Dbe Gurney 0.04 (12.50) 2,568.6 Nexgram Holdings 0.04 (12.50) 1,661.0 Hb Global Ltd 0.08 (11.11) Source: Bloomberg w w w. u t r a d e. c o m. m y 1

2 TRADERS CORNER Poh Kong Holdings (PKH MK) Technical BUY on breakout with +21.8% potential return Last price : RM0.505 Target price : RM0.575, RM0.615 Support : RM0.485 Stop-loss: RM0.48 BUY on breakout with a target price of RM0.615 and stop-loss at RM0.48. Based on the daily chart, we can see PKH tried to penetrate the breakout level at RM0.52 and managed to close above the BBI line yesterday. Aggressive traders can buy at breakout level at RM0.52 and set the shortterm target at RM Currently, the DMI shows buying momentum has overcome selling momentum. This is supported by an uptick in the RSI and currently the MACD shows a bullish crossover. Expected timeframe: 2 weeks to 2 months Pesona Metro Holdings (PESONA MK) Technical BUY with +39.7% potential return Last price : RM0.655 Target price : RM0.835, RM0.915 Support : RM0.585 Stop-loss : RM0.58 BUY with a target price of RM0.915 and stop-loss at RM0.58. On yesterday s movement, PESONA managed to penetrate the breakout level of RM0.65 and closed higher at RM A buying signal is given as the price has been trading above the Ichimoku cloud. This supported by the Heat Wave indicators Tenkan-sen line, Kinjun-sen line and the Chikao span line which show bullish signals. The uptick in the DMI together with the high trading volume, suggests that buying momentum is set to continue in the near term. Currently, the MACD shows a bullish crossover to support the upward momentum. Expected time frame: 2 weeks to 2 months. w w w. u t r a d e. c o m. m y 2

3 TRADERS CORNER Chee Wah Corporation (CWAH MK) Technical BUY on breakout with +20.1% potential return Last price : RM1.31 Target price : RM1.49, RM1.61 Support : RM1.22 Stop-loss : RM1.21 BUY on breakout with a target price of RM1.61 and stop-loss at RM1.21. Based on the daily chart, CWAH formed a series of higher highs and higher lows that indicates an uptrend pattern. The uptick in the DMI, together with the increasing in trading volume, suggests that buying momentum is set to continue in the near term. We expect the stock to continue trending upwards towards our targets at RM1.49 and RM1.61 with the current upleg. Expected Timeframe: 2 weeks to 2 months w w w. u t r a d e. c o m. m y 3

4 CORPORATE NEWS AWC: Bags RM14.65m subcontracts from Sunway. AWC Bhd via its unit M&C Engineering and Trading Sdn Bhd has bagged two jobs for fire protection services in Package 2 (PKG2) and Package 4 (PKG4) from Sunway Construction Sdn Bhd for a total of RM14.65m. In a filing with Bursa Malaysia today, AWC said the wholly-owned subsidiary will be the subcontractor for the proposed design, construction and completion of government office buildings consisting of office tower, podium parking and external works. Known as Parcel F, the project is spread out over approximately 32 acres and is located in Precinct 1 in Putrajaya, the company said. (Source: The Edge Financial Daily) Carimin Petroleum: Extends time frame to utilise IPO proceeds by another 12 months. Carimin Petroleum Bhd will extend the utilisation of the remaining RM11.1mproceeds raised from its initial public offering (IPO) by another 12 months until Dec 31, 2017 as plans were deferred by the decline in oil and gas (O&G) activities. In a filing with Bursa Malaysia today, Carimin said the RM12 million proceeds raised from the IPO were proposed to be utilised by the group or its subsidiaries for the development of a minor fabrication yard measuring 78,448 sq ft at Kawasan Industri Telok Kalong, Kemaman, Terengganu within 18 months. (Source: The Edge Financial Daily) Eco World: EGMs to be held on Feb 20 instead. Eco World Development Group Bhd (EW Bhd) has revised the date of its two EGMs, called to decide on the proposed subscription of up to 27% in Eco World International Bhd (EWI) and the proposed acquisitions of two pieces of land in Penang, to Feb 20. In the original notices to Bursa Malaysia on Jan 31, EW Bhd had fixed Feb 14 for the EGMs to seek approvals for its unit Eco Horizon Sdn Bhd s proposed purchase of acres in South Seberang Prai for RM875.2m and its unit Eco World Capital (International) Ltd s proposed subscription of up to RM777.6m worth of EWI shares in conjunction with EWI s initial public offering. (Source: The Star) Gabungan AQRS: Sells land in Petaling Jaya for RM55.69m. Gabungan AQRS Bhd's wholly-owned subsidiary Nusvista Development Sdn Bhd is selling its leasehold land in Mukim Sungai Buloh, Petaling Jaya for RM55.69mcash. Nusvista today signed a sales and purchase agreement with Gadang Construction Sdn Bhd, according to the construction and property firm. It said the land size measures 10,779 sq m, equivalent to 2.66 acres or 116, sq ft. At a price tag of RM55.69m, this means that Gadang Construction is buying the land at RM per sq ft. With interest in earthworks, building and civil engineering contractor activities, Gadang Construction is the wholly-owned subsidiary of Gadang Holdings Bhd, which is listed on the Main Market of Bursa Malaysia. (Source: The Edge Financial Daily) Loob Holdings: La Kaffa to task over claims of unapproved raw materials in Chatime products. Former Malaysian Chatime master franchisee Loob Holding Sdn Bhd has hit back at allegations by Taiwanese franchise owner La Kaffa International Co Ltd that the "raw materials" used here "were not part of approved recipes" On Monday, Loob lambasted La Kaffa in a pointto-point rebuttal and said its allegations about "raw materials" implied that the quality of Chatime products in Malaysia were compromised "This is entirely untrue. This is not part of La Kaffa's contentions, at any time," said Loob. Last Friday, La Kaffa alleged Loob used and supplied raw materials that were not part of the approved. This unapproved usage of raw materials, claimed La Kaffa, was in breach of the master franchisee contract. (Source: The Star) w w w. u t r a d e. c o m. m y 4

5 Mega Sun City: Ideal Property Group chairman resigns from board. Datuk Alex Ooi Kee Liang has resigned as the managing director of Mega Sun City Holdings Bhd. In a filing to Bursa Malaysia today, Mega Sun City said Ooi, 46, has resigned due to other personal commitments. Ooi is no stranger to the Penang property scene. He is the executive chairman of Ideal Property Group, which is famed for its affordable and medium range developments on the island. In a separate filing to the exchange today, Mega Sun City announced that its executive director Datuk Liang Chee Fong, 44, has been re-designated to the role of managing director following Ooi's resignation. (Source: The Edge Financial Daily) Mydin: Clarifies that losses were due to weaker currency. The weaker ringgit against the US dollar was the main factor for losses incurred by Mydin Mohamed Holdings Bhd in 2016, and not the implementation of the goods and services tax (GST) or government policies. Managing director Datuk Wira Ameer Ali Mydin said the operator of Mydin hypermarkets nationwide had suffered losses due to the weakening ringgit as most of its products were imported. The ringgit against the US dollar level was at 3.65 on April 1, 2015, compared to around 4.42 per US dollar currently. That is how much the ringgit has weakened over that period, he told Bernama on Monday. He said the weakening ringgit against the US dollar had resulted in Mydin having to pay more for the products it ordered, without increasing the price to consumers.(source: The Edge Financial Daily) Sime Darby: Confident of hitting RM2.5b property sales despite glut. Sime Darby Bhd s property division, Sime Darby Property Bhd, is confident of achieving its RM2.5b sales target for the current financial year ending June 30, 2017, despite the current property market glut. Managing director Datuk Jauhari Hamidi said its financial numbers looked promising. God-willing, we should be there. We re halfway through (the financial year) and we ll be announcing our latest results at the end of the month. We will hit the RM2.5b, he told reporters at the Alya WTA Malaysian Open 2017 tennis tournament yesterday. (Source: The Star) Uzma: Bags three-year umbrella contract from Petronas. Oil and gas service firm Uzma Bhd announced that its wholly-owned unit Uzma Engineering Sdn Bhd has received a three-year contract from Petronas Carigali Sdn Bhd to provide electric wirelines logging services. An umbrella contract is normally awarded to a company that acts as an employer to agency contractors who work under a fixed term contract assignment. Uzma said the contract to undertake cased hole logging services covers the whole country. It commenced on Dec 1, 2016 and will run till Dec 30, 2019, and comes with two extension options of one year each. (Source: The Edge Financial Daily) SECTOR Rubber: Better prospects seen for rubber industry. The natural rubber (NR) shortage and the recovery in the global economy have brightened prospects for the industry this year and these will boost global demand. The top-producing countries - - Malaysia and Thailand -- experienced the shortages due to the prolonged rainy season which disrupted output. The International Monetary Fund (IMF), in its World Economic Outlook October 2016, said based on the global economic scenario, which was estimated to grow at a faster rate of 3.4% this year, the shortage will be at 350,000 tonnes this year. (Source: The Star) w w w. u t r a d e. c o m. m y 5

6 FROM THE REGIONAL MORNING NOTES... Technology Malaysia: OSAT: Gripping The Trend Riders The launch of a new-generation smartphone model in the US in Sep 17 and a smartphone model in Korea in 1H17 could create a strong replacement cycle. Relevant outsourced semiconductor assembly and test beneficiaries are ramping up capacities to ride on this smartphone wave. Globetronics is making a strong comeback with mass production of new sensors by May while Inari is on track to add new capacities for radio frequency and iris scanning components. OVERWEIGHT the sector with Inari our top pick. Ann Joo Resources: Firmer Start To The Year (AJR MK/BUY/RM2.46/Target: RM2.60) Earnings visibility for Ann Joo in 2017 remains bright as average steel price in Jan 17 remained high at RM2,275/mt while coal prices have come down since mid-nov 16. The latest development in China s industry consolidation is forcing low quality steel producers to cease operations by end-jun 17. Another key attraction of the stock lies in its generous capital management which could lead to a 2016 dividend yield of 4.9%. Maintain BUY. Target price: RM2.60. For more reports, please log in to or open an account now to gain access. Explore our trading tools designed to assist you in your trading ShareXplorer, ChartGenie, TechAnalyzer, Stock Alerts! Broaden your knowledge through our educational events. Contact us now at to find out more about our ongoing promotions (get FREE* live feed on foreign markets). *T&C apply. w w w. u t r a d e. c o m. m y 6

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