By the Kenanga Research Team l research@kenanga.com.my KLCI BURSA 21-Jul RSI (13D) SMAVG (21D) KLCI 1,868.6 37.5 1,885.4 FTSE EMAS 13,041.9 45.2 13,103.0 FTSE Smallcap 18,705.8 82.1 18,264.5 FTSE MESDAQ 6,913.8 64.6 6,773.1 KLCI Futures 1,865.0 32.5 1,887.0 Jul-14 1,862.0 43.0 1,882.8 Aug-14 2,296.0 31.2 2,383.7 CPO 1,868.6 37.5 1,885.4 INDICES 21-Jul RSI (13D) SMAVG (21D) Dow Jones 17,051.7 56.2 16,965.3 NASDAQ 4,424.7 55.7 4,413.2 FTSE-100 6,728.4 45.5 6,760.4 Nikkei 225 N.A. N.A. 15,304.7 SHCOMP 2,054.5 51.1 2,051.8 HSI 23,387.1 54.0 23,310.7 STI 3,314.3 64.7 3,280.6 KOSPI 2,018.5 58.1 2,004.0 TWSE 9,441.0 54.3 9,444.9 JCI 5,127.1 66.5 4,968.1 SET 1,538.6 79.0 1,501.1 KLCI COMPONENT STOCKS 21-Jul RSI (13D) SMAV (21D) AMBANK 7.11 39.7 7.15 ASTRO 3.37 48.6 3.40 AXIATA 6.87 42.7 6.93 BAT 68.16 58.2 67.18 CIMB 6.96 30.7 7.20 DIGI 5.59 39.2 5.69 FGV 4.04 30.8 4.19 GENTING 9.66 31.8 9.90 GENM 4.26 57.7 4.20 HlBANK 14.08 55.3 13.98 HLFG 17.04 60.6 16.49 IHH 4.67 64.5 4.54 IOICORP 4.99 34.8 5.18 KLCC 6.40 47.3 6.46 KLK 23.80 32.6 24.17 MAYBANK 9.91 50.7 9.90 MAXIS 6.74 50.8 6.73 MISC 6.38 39.9 6.57 PCHEM 6.66 25.1 6.76 PETDAG 19.98 13.8 22.93 PETGAS 23.40 31.9 24.23 PPB 14.44 33.8 14.86 PBBANK 20.12 56.1 19.97 RHBCAP 9.17 72.6 8.77 SKPETRO 4.35 48.6 4.39 SIME 9.65 56.0 9.65 TM 6.30 49.6 6.33 TENAGA 12.30 52.6 12.32 UMW 11.66 83.8 11.24 YTL 1.55 38.2 1.60 Market Snapshot US Market: Dow Jones Industrial Average (DJIA) How was the market? Wall Street slipped on Monday as investors remained cautious over the instability in Ukraine and Gaza. Market participants are generally concern over the fall out in Gaza which could potentially spread to other parts of Middle East. At the closing bell, the Dow Jones Industrial Average dipped 48.45 points or 0.28% to settle at 17,051.73. Top 3 Index Laggards: IBM (-1.65%), McDonald s Corp (-1.44%), Visa Inc. (-0.98%). What is the chart saying? Chart-wise, the DJIA has formed a Hanging Man candlestick, suggesting a bearish reversal could potentially occur. However, we notice that buying support exist at the 20-day SMA level, with market participants using weakness to come back into the market. All key indicators (MACD, RSI and Stochastic) remained flattish, suggesting a possibility of a sideway trading pattern moving forward. Good buying opportunities are expected to emerge closer to the 16,589-level. Neutral Key Resistance level 17,350 (R1) 17,586 (R2) 17,750 (R3) Key Support level 16,830 (S1) 16,589 (S2) 16,353 (S3) Malaysia Market: FBMKLCI Index How was the market? The local equity market started the week on a weaker tone; brought down by weak sentiment following the MH17 incident. Rotational play in small and mid-cap stocks continued to be active on the broader market, but investors focused on specific stocks. At market close, the FBMKLCI fell 4.33 points to 1,868.64. Top 3 Index Laggards: MISC (-1.21pts), PETGAS (-1.07pts), IHH (- 0.97pts). What is the chart saying? Chart-wise, the FBMKLCI formed a bearish long black candlestick, which indicates heavy profit-taking and continuation of a short-term downtrend. Meanwhile, readings from the key indicators also suggested that selling pressure continued to stay strong yesterday. Nevertheless, the current downtrend is expected to be shallow as it is more a knee-jerk panic selling event as the market could be in the midst of digesting the negative impact of the MH17 incident. Immediate buying support is expected to emerge at 1,860/55-area. Sideways range-bound Key Resistance level 1,892 (R1) 1,900 (R2) 1,925 (R3) Key Support level 1,860 (S1) 1,843 (S2) 1,826 (S3) Highlights / Stock Picks of the Day CB Industrial Product Holding Bhd (CBIP) - Trading Buy CBIP jumped 22 sen (5.01%) yesterday, on the back of slightly higher trading volume. The technical picture suggests a buy signal as the share price has broken out of a downward sloping trend channel. The MACD indicator has also staged a crossover of its zero-line, suggesting that a bullish uptrend is imminent. Key indicators are also supporting the bullish uptrend with RSI and Stochastics both hooking upwards. Based on the chart pattern, we expect CBIP to move towards our measurement objective of RM5.65. Traders who are looking to buy into the stock should target RM5.62 (3 bids below the RM5.65 TP), while employing a strict stop-loss at RM4.39 (representing 3 bids below the RM4.42 support level). Bullish Key Resistance level RM4.80 (R1) RM5.34 (R2) RM5.67 (R3) Key Support level RM4.42 (S1) RM4.25 (S2) RM3.92 (S3) Strategy Trading Buy Current Price RM4.61 Kamdar Group (M) Bhd (KAMDAR) - Stopped Out Recall that on 3rd July 2014 we placed a Trading Buy call on KAMDAR with a Flagpole measurement objective of RM1.04 on the expectation of potentially stronger sales backed by the coming Ramadan and Hari Raya festive season sales. However, this has failed to materialize with the share price hitting our cutloss level of RM0.70 yesterday. Technically speaking, the share price has broken down from its Fibonacci support level at RM0.739 following its inability to test the technical resistance level of RM0.85. Further bearishness is seen in the stock with MACD crossing over the Signal line with negative divergence. Momentum is also seen waning with RSI indicators hooking downwards. Thus, we suggest traders to cut loss at RM0.70 for now. Bearish Key Resistance level RM0.85 (R1) RM0.96 (R2) RM1.03 (R3) Key Support level RM0.74 (S1) RM0.62 (S2) RM0.56 (S3) Strategy Stopped Out Current Price RM0.78 PP7004/02/2013(031762) Page 1 of 6
Daily Charting Dow Jones Industrial Average (DJIA) What is the chart saying? Chart-wise, the DJIA has formed a Hanging Man candlestick, suggesting a bearish reversal could potentially occur. However, we notice that buying support exist at the 20-day SMA level, with market participants using weakness to come back into the market. All key indicators (MACD, RSI and Stochastic) remained flattish, suggesting a possibility of a sideway trading pattern moving forward. Good buying opportunities are expected to emerge closer to the 16,589-level. Technical Ratings Resistance 2 17,586 MACD Neutral Resistance 1 17,350 Stochastic Neutral Current Level 17,051.73 RSI Neutral Support 1 16,830 Support 2 16,589 Neutral Daily Charting FBM KLCI index What is the chart saying: Chart-wise, the FBMKLCI formed a bearish long black candlestick, which indicates heavy profittaking and continuation of a short-term downtrend. Meanwhile, readings from the key indicators also suggested that selling pressure continued to stay strong yesterday. Nevertheless, the current downtrend is expected to be shallow as it is more a knee-jerk panic selling event as the market could be in the midst of digesting the negative impact of the MH17 incident. Immediate buying support is expected to emerge at 1,860/55- area. Technical Ratings Resistance 2 1900 MACD Bearish Resistance 1 1892 Stochastic Neutral Current Level 1868.64 RSI (14) Bearish Support 1 1860 Support 2 1843 Sideways rangebound PP7004/02/2013(031762) Page 2 of 6
Daily Charting CB Industrial Product Holding Bhd About the stock: Name : CB Industrial Product Holding Bhd Bursa Code : CBIP CAT Code : 7076 Market Cap : 1,222.7 52 Week High/Low : 4.80/2.50 3-m Avg. Daily Vol. : 201,892.1 Free Float (%) : 58.2% Beta vs. KLCI : 1.2 CBIP jumped 22 sen (5.01%) yesterday, on the back of slightly higher trading volume. The technical picture suggests a buy signal as the share price has broken out of a downward sloping trend channel. The MACD indicator has also staged a crossover of its zero-line, suggesting that a bullish uptrend is imminent. Key indicators are also supporting the bullish uptrend with RSI and Stochastics both hooking upwards. Based on the chart pattern, we expect CBIP to move towards our measurement objective of RM5.65. Traders who are looking to buy into the stock should target RM5.62 (3 bids below the RM5.65 TP), while employing a strict stop-loss at RM4.39 (representing 3 bids below the RM4.42 support level). Key Support & Resistance level Resistance : RM4.80(R1) RM5.34 (R2) RM5.67 (R3) Support : RM4.42 (S1) RM4.25 (S2) RM3.92 (S3) : Bullish What does indicator says: MACD : Bullish Stochastic : Overbought RSI : Bullish Trend : Bullish What should you do: Strategy : Trading Buy Current Share Price : RM4.61 Fundamental Call KNK : RM4.90 Consensus : RM4.87 PP7004/02/2013(031762) Page 3 of 6
Daily Charting Kamdar Group (M) Bhd About the stock: Name : Kamdar Group (M) Bhd Bursa Code : KAMDAR CAT Code : 8672 Market Cap : 155.4 52 Week High/Low : 0.90/0.38 3-m Avg. Daily Vol. : 159,444.4 Free Float (%) : 37.2 Beta vs. KLCI : 0.03 Recall that on 3rd July 2014 we placed a Trading Buy call on KAMDAR with a Flagpole measurement objective of RM1.04 on the expectation of potentially stronger sales backed by the coming Ramadan and Hari Raya festive season sales. However, this has failed to materialize with the share price hitting our cutloss level of RM0.70 yesterday. Technically speaking, the share price has broken down from its Fibonacci support level at RM0.739 following its inability to test the technical resistance level of RM0.85. Further bearishness is seen in the stock with MACD crossing over the Signal line with negative divergence. Momentum is also seen waning with RSI indicators hooking downwards. Thus, we suggest traders to cut loss at RM0.70 for now. Key Support & Resistance level Resistance : RM0.85 (R1) RM0.96 (R2) RM1.03 (R3) Support : RM0.74 (S1) RM0.62 (S2) RM0.56 (S3) : Bearish What does indicator says: MACD : Bearish Stochastic : Bearish RSI : Bearish Trend : Bearish What should you do: Strategy : Stopped Out Current Share Price : RM0.78 Fundamental Call KNK : N.A. Consensus : N.A PP7004/02/2013(031762) Page 4 of 6
Unrealised Positions (July 2014) No CATS Gain/ Gain/ Dividend Issued Date Price Target Stop- Upside Downside Reward/ Last Stock Name Received since Loss (ID) @ ID Price Loss Potential Risk Risk Ratio Price ID (incl. Code Div.) Loss RM RM (%) (%) (x) RM RM RM (%) 1 3883 MUDA HOLDINGS BERHAD 24-Apr-14 1.90 2.43 1.65 27.89% -13.16% 2.1 2.30 0.03 0.43 22.63% BUY - 2 0166 INARI AMERTRON BHD 19-Jun-14 3.01 3.48 2.88 15.61% -4.32% 3.6 3.25-0.24 7.97% BUY - 3 7076 CB INDUSTRIAL PRODUCT HLDG 21-Jul-14 4.61 5.62 4.39 21.91% -4.77% 4.6 4.61-0.00 0.00% BUY - Rating Comment/ Action *Tracker does not include Non-Rated positions Realised Positions (July 2014) No Simple Average 21.81% -7.42% 3.44 10.20% CATS Intraday price Price change Gain/ Gain/ Issued Buy Sell Sell Dividend Received Stock Name since since Date Price Date Price since ID Loss (incl. Code Buy Date Buy Date (%) Div.) Loss (H) (L) (H) (L) RM RM RM (%) Rating Comment/ Action 1 5162 ECS ICT BHD 24-Jan-14 1.18 1.46 1.12 23.73% -5.08% 3-Jul-14 1.43 0.03 0.28 23.31% Take Profit RM1.43 TP surpassed 2 7155 SKP RESOURCES BHD 17-Jun-14 0.48 0.61 0.47 27.08% -2.08% 8-Jul-14 0.60-0.12 25.00% Take Profit RM0.60 TP met 3 0097 VITROX CORP BHD 23-Jun-14 1.98 2.70 2.23 36.36% 12.63% 9-Jul-14 2.41 0.02 0.45 22.73% Take Profit RM2.41 TP met 4 8672 KAMDAR GROUP M BHD 3-Jul-14 0.80 0.87 0.67 8.75% -16.25% 21-Jul-14 0.70 0.04-0.06-7.50% Stopped-out RM0.70 stop-loss level triggered Simple Average 23.98% -2.70% 15.88% PP7004/02/2013(031762) Page 5 of 6
Basic Technical Terms: Reversal Candlesticks Patterns Description Doji Dragonfly Doji (Bullish) Gravestone Doji (Bearish) Engulfing Pattern Hammer (Bullish) Shooting Star (Bearish) Inverted Hammer (Bullish) Hanging Man (Bearish) Harami Harami Cross Dojis form when a security's open and close are virtually equal. The length of the upper and lower shadows can vary, and the resulting candlestick looks like, either, a cross, inverted cross, or plus sign. Doji convey a sense of indecision or tug-of-war between buyers and sellers. A reversal pattern that can be bearish or bullish, depending upon whether it appears at the end of an uptrend (bearish engulfing pattern) or a downtrend (bullish engulfing pattern). The first day is characterized by a small body, followed by a day whose body completely engulfs the previous day's price action. Hammer candlesticks form when a security moves significantly lower after the open, but rallies to close well above the intraday low. This appears in a downtrend. In contrast, the Shooting Star pattern appears in an uptrend. It opens higher, trades much higher, then closes near its open. It looks just like the Inverted Hammer except that it is bearish. The Inverted Hammer is a single-day bullish reversal pattern. In a downtrend, the open is lower, then it trades higher, but closes near its open price, therefore looking like an inverted lollipop. Hanging Man candlesticks form when a security moves significantly lower after the open, but rallies to close well above the intraday low. The Harami is a two-day pattern that can be bullish or bearish. It has a small body day completely contained within the range of the previous body, and is the opposite colour. The Harami Cross is similar to the Harami. The difference is that the last day is a Doji. Marubozu A Marubozu candlestick has no shadow extending from the body at either the open, the close or at both. Morning Doji Star (Bullish) Evening Doji Star (Bearish) Spinning Top A Morning Doji Star (Evening Doji Star) is a three-day candlestick bullish (bearish) reversal pattern - a long-bodied black (white) candle extending the current downtrend, a short middle candle that gapped down (up) on the open, and a long-bodied white candle that gapped up (down) on the open and closed above (below) the midpoint of the body of the first day. Spinning Tops are candlestick lines that have small bodies with upper and lower shadows that exceed the length of the body. They are similar to the Doji candlesticks, and signal indecision. Source: Various Common Chart Patterns Reversal Patterns Inverted Head & Shoulders (Bullish) Head & Shoulders (Bearish) Wedge Reversal (Bullish/ Bearish) Double Top (Bearish) Double Bottom (Bullish) Continuation Patterns Symmetrical Triangle (Bullish/ Bearish) Ascending Triangle (Bullish) Channels (Bullish/ Bearish) Flags (Bullish/ Bearish) Pennant (Bullish/ Bearish) Source: Various This document has been prepared for general circulation based on information obtained from sources believed to be reliable but we do not make any representations as to its accuracy or completeness. Any recommendation contained in this document does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may read this document. This document is for the information of addressees only and is not to be taken in substitution for the exercise of judgement by addressees. Kenanga Investment Bank Berhad accepts no liability whatsoever for any direct or consequential loss arising from any use of this document or any solicitations of an offer to buy or sell any securities. Kenanga Investment Bank Berhad and its associates, their directors, and/or employees may have positions in, and may effect transactions in securities mentioned herein from time to time in the open market or otherwise, and may receive brokerage fees or act as principal or agent in dealings with respect to these companies. Published and printed by: KENANGA INVESTMENT BANK BERHAD (15678-H) 8th Floor, Kenanga International, Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia Telephone: (603) 2166 6822 Facsimile: (603) 2166 6823 Website: www.kenanga.com.my Chan Ken Yew Head of Research PP7004/02/2013(031762) Page 6 of 6