R e t a i l M a r k e t M o n i t o r Friday, 10 July 2015

Transcription

1 MARKET NEWS The FBMKLCI rose 5.71pt to close at 1, yesterday after a technical rebound in index stocks, buoyed by positive sentiments from the Hong Kong market. Regionally, Asian stocks advanced, with the regional benchmark index rebounding from its biggest decline in two years, as Chinese equities rose in volatile trading after the government ramped up measures to stem the equity rout. The MSCI Asia Pacific Index rose 0.8% to The FBMKLCI s top gainers were Genting Bhd (+2.7%), AMMB Holdings (+2.2%) and RHB Capital (+2.0%) while the top losers were British American Tobacco (-1.1%), Astro Malaysia Holdings (-1.0%) and Public Bank (-1.0%). In the broader market, gainers outpaced losers 557 to 271 with 287 counters unchanged. Turnover was 1.82b shares valued at RM1.83b. The FBMKLCI was trading within a tight range but managed to make a technical rebound yesterday after consecutive days of losses. We expect the index to trade sideways in the near term due to the weakening ringgit and uncertainty in the broader market. If the index cannot stay at the current levels, it can fall back to the support levels at 1,688 or 1,671. The support and resistance levels are maintained as follow: Support: 1,688, 1,671 Resistance: 1,737, 1,751 US markets ended higher as bargains hunters took positions after the prior trading session's slump. The S&P 500 ended 0.2%, higher at 2, while the DJIA rose 0.2%, at 17, The number of people who applied for US unemployment benefits in the week ended 4 July rose unexpectedly to the highest level since February, mainly because of annual shutdowns at auto plants in states such as Michigan and Ohio for retooling. Walgreens Boots Alliance jumped 4.2% after its third-quarter profit beat expectations. WHAT S IN THE PACK 2H15 Outlook: Who Moved MY s Cheese Tepid corporate earnings growth, shrinking ROEs and economic headwinds will persist. We expect the market to retreat further before a liquidity-driven lift in 4Q15. Stay defensive. Mieco Chipboard (MIEC MK) Technical BUY with +34.8% potential return BUY with a target price of RM1.24 and stop loss at below RM Based on our last BUY call on 9 Feb 15, MIEC had hit our targets of RM0.615 and RM Currently, MIEC continues to form higher highs and higher lows on the daily chart. Century Bond (CBD MK) Technical BUY on breakout with 26.0% potential return BUY on breakout with a target price of RM2.28 and stop-loss at below RM1.59. Currently, the stock has been trading above the BBI line. Cycle & Carriage Bintang (CNCB MK) Technical BUY with 29.0% potential return BUY with a target price of RM3.29 and stop-loss at below RM2.39. A buying signal has been given as the stock has been trading above the cloud. FBMKLCI CHART Source: BursaStation KEY INDICES Prev Close Chg (%) YTD (%) DJIA 17, (1.54) S&P 500 2, (0.37) FTSE 100 6, CSI 300 3, FSSTI 3, (0.54) (2.90) HSCEI 11, (4.49) HSI 24, JCI 4, (0.68) (7.44) KLCI 1, (3.39) KOSPI 2, Nikkei , SET 1, (1.68) TWSE 8, (0.69) (4.22) BDI CPO (RM/mt) 2, (3.49) Nymex Crude (US$/bbl) (7.19) TOP VOLUME Stock Price (RM) Chg (%) Vol ( 000) Multi Sports Holdings ,899 Airasia Bhd ,851 Knm Group Bhd ,279 Frontken Corp Bhd ,064 Airasia X Bhd 0.20 (2.50) 32,944 TOP GAINERS Stock Price (RM) Chg (%) Vol ( 000) R&A Asia Media Group ,807 Tfp Solutions Bhd Mieco Chipboard Bhd ,790 Ta Win Holdings Bhd TOP LOSERS Stock Price (RM) Chg (%) Vol ( 000) Kuantan Flour Mills 0.13 (13.33) Utopia Bhd 0.04 (12.50) Mentiga Corp Bhd 0.64 (11.11) 0.5 Flonic Hi-Tec Bhd 0.05 (9.09) 11,935. Media Shoppe 0.06 (8.33) 3,984.0 Source: Bloomberg w w w. u t r a d e. c o m. m y 1

2 TRADERS CORNER Mieco Chipboard (MIEC MK) Technical BUY with +34.8% potential return Last price : RM0.92 Target price : RM1.18, RM1.24 Support : RM0.75 Stop loss : RM0.745 BUY with a target price of RM1.24 and stop loss at below RM Based on our last BUY call on 9 Feb 15, MIEC had hit our targets of RM0.615 and RM Currently, MIEC continues to form higher highs and higher lows on the daily chart. This bullish pattern is supported by positive readings in the RSI accompanied by higher trading volumes. Currently, the DMI shows buying momentum overcoming selling momentum. We peg our new targets at RM1.18 and RM1.24 in the near term. Expected Timeframe: 2 weeks to 2 months Century Bond (CBD MK) Technical BUY on breakout with +26.0% potential return Last price : RM1.77 Target price : RM1.96, RM2.28 Support : RM1.60 Stop-loss : RM1.59 BUY on breakout with a target price of RM2.28 and stop-loss at below RM1.59. Currently, the stock has been trading above the BBI line. It rebounded on yesterday s gain and established a new upleg. Persistent buying interest as shown by the DMI should drive share price higher. Additionally, the positive MACD reading suggests a stronger uptrend ahead. We expect the stock to continue to move upwards once it breaks out of RM1.81. Expected Timeframe: 2 weeks to 3 months w w w. u t r a d e. c o m. m y 2

3 TRADERS CORNER Cycle & Carriage Bintang (CNCB MK) Technical BUY with % potential return Last price : RM2.55 Target price : RM2.94, RM3.29 Support : RM2.40 Stop-loss : RM2.39 BUY with a target price of RM3.29 and stop-loss at below RM2.39. A buying signal has been given as the stock has been trading above the cloud. The Heat Wave indicators - Tenkan-sen line, Kinjun-sen line and the Chikao span line are showing bullish signals. Based on the daily chart, CNCB penetrated the breakout level of RM2.56 but closed lower at RM2.55. The uptick in the DMI shows buying momentum is outpacing selling momentum. This is supported by positive readings in the RSI. We peg our mediumterm targets at RM2.94 and RM3.29. Expected Timeframe: 2 weeks to 3 months w w w. u t r a d e. c o m. m y 3

4 CORPORATE NEWS 1MDB: The Penang lodges caveat on 1MDB Land. The Penang Government has ordered the state Land and Mines Department to lodge a caveat on land owened by 1MDB in the state. Chief Minister Lim Guan Eng said there are concerns over the ownership of the 94.7ha land in Air Itam. (Source: The Star) Censof Holdings: Buys controlling stake in partner ABSS. Censof Holdings is buying a controlling stake in its partner Asian Business Solutions Pte Ltd (ABSS) for S$10m (RM28.06m). Censof deputy group managing director Tamil Selvan Durairaj said the deal would take about two months to be completed. For the financial year ended Dec31, 2014, ABSS s revenue was at S$8m while earnings before interest, taxes, depreciation and amortization stood at S$4m. (Source: The Star) GuocoLand: Options open on monetising Damansara City Mall, talks with Lim fails. GuocoLand is keeping its options open on how to monetise its Damansara City mall in Damansara Heights. The mall is located strategically at the massive development that is taking shape and which is seen as a viable alternative to Bangsar with two MRT stations being built at its vicinity. Known as Damansara City Mall, it is in its last lap of completion and is scheduled to be operational by the second quarter of next year. It has attracted tenancy of about 60%. (Source: The Star) Daya Materials: Daya signs vessel deal with Siem Offshore. Daya Materials has entered into a novation agreement with Siem Offshore Rederi AS (SORA) via its wholly-owned subsidiary Daya Global of the dynamic positioning class 2 offshore subsea construction vessel. In a filing with Bursa Malaysia, Daya said it would assume all obligations and liabilities of the memorandum of agreement, while SORA released and discharged Daya from all obligations and liabilities to accept DG1PL s. (Source: The Star) Tenaga: Jimah may get new shareholder. Jimah East Power, the operator of the 2,000MW coal-fired power plant known as Project 3B, may see the entry of a new shareholder after it completes its financial close. At present, Tenaga Nasional holds a 70% stake in JEP, while Mitsui & Co owns the remaining 30% through 3B Power. (Source: The Star) Tenaga: Another shareholder sues TNB over Integrax takeover. Another dissenting shareholder has taken legal action against TNB, saying the utility giant s offer document in January on the takeover offer of Integrax shares is erroneous and void. TNB told Bursa Malaysia that it had been served with originating summons from Yau Wai Leong in relation to its conditional takeover offer of the remaining shares in the Lumut port operator. (Source: The Star) SP Setia: 18 Woodsville project in Singapore on track. SP Setia s maiden development in Singapore, 18 Woodsville, has been completed two months ahead of schedule. The property developer said in a statement that owners of apartments in the the 15-storey building with a GDV of S$120m (RM336.5m) were now being invited to collect the keys to their units. (Source: The Star) Sunway: on track to achieve its goal. Property and construction group Sunway that has unbilled sales of RM 5.2b as of March, will adopt a wait-and-see approach and plan its property launches accordingly amid the soft property market. Its property division MD Serena Cheah said due to uncertain market sentiments and the revisions made to the Strata Title Act 1985, the group expected the upcoming property launches to be delayed. (Source: The Star) w w w. u t r a d e. c o m. m y 4

5 SECTOR Aviation: Indonesia Transport Authority changes stance. The Indonesian transport authorities have taken a change of stance on their earlier ruling requiring airlines such as AirAsia to improve finances or ship out of their country by now saying that they would help and support these firms. The change of stance saw AirAsia s shares rebounding by one sen to close at RM 1.31, after having lost more than 12% of its value in the last few trading days following statements from Indonesian ministry officials that 13 airlines, including AirAsia s 49% Indonesian affiliate, would need to get a positive equity position by July 31 or be shut down. (Source: The Star) Property: Weak ringgit to attract foreign property buyers. A weaker ringgit will attract more foreign investment into the country s property sector, Guocoland MD Tan Lee Koon said. The property arm of Hong Leong group expects the current exchange rate scenario to spur demand for luxury residences in it Damansara City development, which has a gross development of RM 2.5b. (Source: The Edge Financial Daily) ECONOMY OPR: Bank Negara maintains rate, expects moderate growth. Bank Negara has kept its overnight policy rate unchanged at 3.25% amid expectations of growth moderating. In a statement after its monetary policy committee (MPC) meeting, the central bank said there were heightened risks to global growth and financial conditions, which were monitored to assess their implications on the Malaysian economy. (Source: The Star) POLITICS Najib: We will ensure the truth emerges. PM Datuk Seri Najib Razak yesterday vowed that he will ensure the truth about himself and 1MDB will emerge, even as a special task force probes into claims that billions of ringgit had been channeled into his personal accounts. (Source: The Edge Financial Daily) w w w. u t r a d e. c o m. m y 5

6 FROM THE REGIONAL MORNING NOTES... 2H15 Outlook Tepid corporate earnings growth and shrinking ROEs will persist through to 2016, compounding the country s economic headwinds. We expect the market to retreat further in 3Q15 as risk aversion rises, before staging a liquidity-driven comeback in 4Q15 towards our year-end FBMKLCI target of 1,810 (valuing the index at 15.7x PE, or +0.6SD vs the mean). Our top picks are large caps Maybank, Tenaga, Genting Bhd and IJM Corp, and small/mid-caps Top Glove, JCY International and Sunsuria. 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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