MARKET NEWS FBMKLCI CHART The FBMKLCI lost 15.22pt (-0.8%) to close at 1,791.74 yesterday on a lack of fresh local leads and weak regional markets. Meanwhile, Asian stocks fell the most in more than a month as US jobs data fuelled bets that the Federal Reserve will be raising interest rates sooner than expected. The MSCI Asia Pacific Index slipped 0.9% to 144.16. The FBMKLCI s top losers were Skpetro (-4.2%), GENM (-3.6%) and Petdag (- 2.1%) while the top gainers were KLCC (+1.3%), FGV (+0.5%) and Axiata (+0.4%). In the broader market, losers outpaced gainers 544 to 273 with 292 counters unchanged. Turnover was 2.14b shares valued at RM1.87b. The FBMKLCI continued its pullback yesterday. Based on the chart, the FBMKLCI penetrated the lower uptrend channel line and closed below the psychological level of 1,800. The correction looks set to continue as selling pressure has risen, as reflected in the negative reading of the RSI. This is supported by the DMI which is making a bearish crossover. Weaker regional sentiment and an absence of domestic catalysts may drag the index lower in the near term. If current sentiment persists, the FBMKLCI may test the support level at 1,770 shortly. The support and resistance levels are as follows: Support: 1,780, 1,770 Resistance: 1,830, 1,845 US markets rallied as bargain hunters took positions after the recent decline. The S&P 500 rose 0.4% to 2,079.43, while the DJIA ended 0.8% higher at 17,995.72. Apple advanced 0.4% as the company unveiled its much-anticipated Apple Watch device as well as a new, thinner MacBook notebook computer. Macerich jumped 7% after Simon Property Group said it sent a proposal to buy the real-estate investment trust in a deal valued at US$22.4b, including US$6.4b in debt. WHAT S IN THE PACK Rubber Gloves Aggregate sector earnings improve by 6% qoq on the back of firmer exchange rate and softer raw material prices. Oceancash Pacific (OCP MK) Technical BUY on breakout with +20.0% RM0.44 and stop loss at below RM0.275. A successful rebound from the major support of RM0.28 has sent the stock higher. BHS Industries (BHSI MK) Technical BUY on breakout with +19.1% RM0.84 and stop loss at below RM0.62. After the earlier correction, share price has rebounded and rose above the BBI line, which implies the recent correction has ended. Muda Holdings (MUDA MK) Technical BUY on breakout with +26.4% RM2.24 and stop loss at below RM1.59. A buying signal has been seen as the stock is trading above the cloud. Source: BursaStation KEY INDICES Prev Close YTD DJIA 17,995.72 0.78 0.97 S&P 500 2,079.43 0.39 1.00 FTSE 100 6,876.47 (0.51) 4.73 CSI 300 3,537.75 1.70 0.11 FSSTI 3,404.57 (0.38) 1.17 HSCEI 11,675.92 0.59 (2.58) HSI 24,123.05 (0.17) 2.19 JCI 5,444.63 (1.27) 4.16 KLCI 1,791.74 (0.84) 1.73 KOSPI 1,992.82 (1.00) 4.03 Nikkei 225 18,790.55 (0.95) 7.68 SET 1,559.71 (0.55) 4.14 TWSE 9,562.98 (0.86) 2.75 BDI 568.00 0.53 (27.37) CPO (RM/mt) 2,271.00 (0.74) 0.22 Nymex Crude (US$/bbl) 49.99 (0.02) (7.87) Source: Bloomberg TOP VOLUME Stock Price (RM) Vol ( 000) Privasia Technology 0.26 15.56 139,881 Asia Bioenergy 0.11 (4.35) 123,276 Wintoni Group Bhd 0.30 15.69 113,751 Nexgram Holdings 0.11 4.76 91,316 Eti Tech Corp Bhd 0.11 10.53 82,974 TOP GAINERS Stock Price (RM) Vol ( 000) Turiya Bhd 0.23 21.0 1 G Neptune Bhd 0.07 18.1 9,060 Lee Swee Kiat 0.24 17.5 8,992 Jhm Consolidation 0.17 17.2 55 Wintoni Group Bhd 0.30 15.6 113,751 TOP LOSERS Stock Price (RM) Vol ( 000) Palette Multimedia 0.05 (10.00) 58.0 Asia Media Group 0.05 (9.09) 480.0 Hb Global Ltd 0.06 (7.69) 19.9 Mui Properties Bhd 0.32 (7.35) 81.0 Acme Holdings Bhd 0.26 (7.27) 57.0 Source: Bloomberg w w w. u t r a d e. c o m. m y 1
TRADERS CORNER Oceancash Pacific (OCP MK) Technical BUY on breakout with +27.5% Last price : RM0.325 Target price : RM0.39, RM0.44 Support : RM0.28 Stop loss : RM0.275 RM0.44 and stop loss at below RM0.275. A successful rebound from the major support of RM0.28 has sent the stock higher. Yesterday s gap up above the BBI line has kicked started a new up-leg. Given higher trading volumes and the positive readings from both the MACD and the DMI, we expect an upward continuation from here, thus pegging our upside targets at RM0.39 and RM0.44 respectively. Expected Timeframe: 2 weeks to 2 months BHS Industries (BHSI MK) Technical BUY on breakout with +19.1% Last price : RM0.665 Target price : RM0.785, RM0.84 Support : RM0.625 Stop loss : RM0.62 RM0.84 and stop loss at below RM0.62. After the earlier correction, share price has rebounded and rose above the BBI line, which implies the recent correction has ended. A positive closing above the BBI line yesterday was accompanied by a bullish crossover in the DMI, which indicates buying momentum has overcome selling momentum. As such, we expect the upward move to be sustainable once the stock penetrates the breakout level of RM0.705. Thus, we peg our upside targets at RM0.785 and RM0.845. Expected Timeframe: 2 weeks to 3 months w w w. u t r a d e. c o m. m y 2
TRADERS CORNER Muda Holdings (MUDA MK) Technical BUY on breakout with +26.4% Last price : RM1.69 Target price : RM1.99, RM2.24 Support : RM1.60 Stop loss : RM1.59 RM2.24 and stop loss at below RM1.59. A buying signal has been seen as the stock is trading above the cloud. The Heat Wave indicators the Tenkan sen line, Kinjunsen line and the Chikao span line - are showing bullish signals. This is supported by the bullish crossover in the MACD and the DMI, which suggests the buying momentum, is set to continue in the near term. We expect MUDA will continue to move up once share price penetrates the breakout level of RM1.78. Expected Timeframe: 2 weeks to 3 months w w w. u t r a d e. c o m. m y 3
CORPORATE NEWS WCT Holdings: JV awarded RM1.2b Qatar project. WCT Holdings Bhd has been awarded a RM1.2 billion contract in Doha, Qatar, through its wholly-owned subsidiary WCT Berhad s joint venture with Al-Ali Projects Co. there. The contract, from Lusail Real Estate Development Company calls for the development of a commercial boulevard that entails building roads, utilities, underground carparks, and LRT stations. WCT Holdings said in a Bursa Malaysia filing today that the JV with Al-Ali Projects, on a ratio of 70:30, is expected to see completion in 2Q2017. (Source: Business Times) KKB Engineering: ventures into O&G in JV with Australia s Icon. KKB Engineering Bhd is venturing into the oil and gas sector following a tie-up with Australia s Icon Engineering Pty Ltd. It said on Monday its associate, OceanMight Sdn Bhd had signed a consortium agreement with Icon Oilfield Solutions Sdn Bhd to identify, secure and perform work on O&G field developments in Malaysia. KKB said the agreement would enable both parties to leverage on their combined capabilities and resources involving the engineering and construction of minimal facilities platforms and lightweight structures. (Source: The Star) Benalec Holdings: to reap nearly RM45m from Melaka land sale. Benalec Holdings Bhd is expected to reap RM44.75mil from the sale of 70.46 acres of reclaimed leasehold land in Melaka. The company said on Monday it was selling the nine parcels of land to Arena Progresif Sdn Bhd for RM128.91mil cash while its land cost was RM84.16mil. The parcels of land are in Pekan Klebang Seksyen II, Melaka Tengah, about 9.5km due southwest of Melaka City Centre. (Source: The Star) Puncak Niaga: In limbo as water agreement lapses. Puncak Niaga is likely to be in limbo over its water assets which it has agreed to divest to Pengurusan Air Selangor Sdn Bhd (Air Selangor) as part of the state s water industry consolidation. According to Selangor Menteri Besar Mohamed Azmin Ali, the sale and purchase agreement (SPA) that Puncak Niaga and Air Selangor entered into in Nov last year for the former to sell its water treatment and distribution assets is void now after the state government has declined to give a third extension to the master water agreement, which lapsed yesterday. (Source: The Edge) w w w. u t r a d e. c o m. m y 4
FROM THE REGIONAL MORNING NOTES... Rubber Gloves : 4Q14 Report Card: Bottom-line Improves Across The Board Aggregate sector earnings improved by 6% qoq on the back of firmer exchange rate and softer raw material prices with Kossan topping the list thanks to contribution from a newly commissioned plant. Valuations of glove companies had fully priced in sectors growth catalysts. Nevertheless, Top Glove continues to offer an attractive proposition on the back of the widening breadth in sector valuations. Maintain MARKET WEIGHT For more reports, please log in to www.utrade.com.my 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 03-2147 1900 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 5
Disclosures/Disclaimers This report is prepared and/or distributed by UOB Kay Hian Pte Ltd ( UOBKH ), which is a holder of a capital markets services licence and an exempt financial adviser in Singapore. This report is provided for information only and is not an offer or a solicitation to deal in securities or to enter into any legal relations, nor an advice or a recommendation with respect to such securities. This report is prepared for general circulation. It does not have regard to the specific investment objectives, financial situation and the particular needs of any recipient hereof. Advice should be sought from a financial adviser regarding the suitability of the investment product, taking into account the specific investment objectives, financial situation or particular needs of any person in receipt of the recommendation, before the person makes a commitment to purchase the investment product. This report is confidential. This report may not be published, circulated, reproduced or distributed in whole or in part by any recipient of this report to any other person without the prior written consent of UOBKH. This report is not intended for distribution, publication to or use by any person in any jurisdiction outside Singapore or any other jurisdiction as UOBKH may determine in its absolute discretion, where the distribution, publication or use of this report would be contrary to applicable law or would subject UOBKH and its connected persons (as defined in the Financial Advisers Act, Chapter 110 of Singapore) to any registration, licensing or other requirements within such jurisdiction. The information or views in the report ( Information ) has been obtained or derived from sources believed by UOBKH to be reliable. However, UOBKH makes no representation as to the accuracy or completeness of such sources or the Information and UOBKH accepts no liability whatsoever for any loss or damage arising from the use of or reliance on the Information. UOBKH and its connected persons may have issued other reports expressing views different from the Information and all views expressed in all reports of UOBKH and its connected persons are subject to change without notice. UOBKH reserves the right to act upon or use the Information at any time, including before its publication herein. Except as otherwise indicated below, (1) UOBKH, its connected persons and its officers, employees and representatives may, to the extent permitted by law, transact with, perform or provide broking, underwriting, corporate finance-related or other services for or solicit business from, the subject corporation(s) referred to in this report; (2) UOBKH, its connected persons and its officers, employees and representatives may also, to the extent permitted by law, transact with, perform or provide broking or other services for or solicit business from, other persons in respect of dealings in the securities referred to in this report or other investments related thereto; (3) the officers, employees and representatives of UOBKH may also serve on the board of directors or in trustee positions with the subject corporation(s) referred to in this report. (All of the foregoing is hereafter referred to as the Subject Business ); and (4) UOBKH may otherwise have an interest (including a proprietary interest) in the subject corporation(s) referred to in this report. As of the date of this report, no analyst responsible for any of the content in this report has any proprietary position or material interest in the securities of the corporation(s) which are referred to in the content they respectively author or are otherwise responsible for. Each research analyst of UOBKH who produced this report hereby certifies that (1) the views expressed in this report in any event accurately reflect his/her personal views about all of the subject corporation(s) and securities in this report; (2) the report was produced independently by him/her; (3) he/she does not carry out, whether for himself/herself or on behalf of UOBKH or any other person, any of the Subject Business involving any of the subject corporation(s) or securities referred to in this report; and (4) he/she has not received and will not receive any compensation that is directly or indirectly related or linked to the recommendations or views expressed in this report or to any sales, trading, dealing or corporate finance advisory services or transaction in respect of the securities in this report. However, the compensation received by each such research analyst is based upon various factors, including UOBKH s total revenues, a portion of which are generated from UOBKH s business of dealing in securities. IMPORTANT DISCLOSURES FOR INCLUDED RESEARCH ANALYSES OR REPORTS OF FOREIGN RESEARCH HOUSES Where the report is distributed in Singapore and contains research analyses or reports from a foreign research house, please note: (i) recipients of the analyses or reports are to contact UOBKH (and not the relevant foreign research house) in Singapore in respect of any matters arising from, or in connection with, the analysis or report; and (ii) to the extent that the analyses or reports are delivered to and intended to be received by any person in Singapore who is not an accredited investor, expert investor or institutional investor, UOBKH accepts legal responsibility for the contents of the analyses or reports IMPORTANT DISCLOSURES FOR U.S. PERSONS This research report was prepared by UOBKH, a company authorized, as noted above, to engage in securities activities in Singapore. UOBKH is not a registered broker-dealer in the United States and, therefore, is not subject to U.S. rules regarding the preparation of research reports and the independence of research analysts. This research report is provided for distribution by UOBKH (whether directly or through its US registered broker dealer affiliate named below) to major U.S. institutional investors in reliance on the exemption from registration provided by Rule 15a-6 of the U.S. Securities Exchange Act of 1934, as amended (the Exchange Act ). All US persons that w w w. u t r a d e. c o m. m y 6
receive this document by way of distribution from or which they regard as being from UOBKH by their acceptance thereof represent and agree that they are a major institutional investor and understand the risks involved in executing transactions in securities. Any U.S. recipient of this research report wishing to effect any transaction to buy or sell securities or related financial instruments based on the information provided in this research report should do so only through UOB Kay Hian (U.S.) Inc ( UOBKHUS ), a registered brokerdealer in the United States. Under no circumstances should any recipient of this research report effect any transaction to buy or sell securities or related financial instruments through UOBKH. UOBKHUS accepts responsibility for the contents of this research report, subject to the terms set out below, to the extent that it is delivered to and intended to be received by a U.S. person other than a major U.S. institutional investor. The analyst whose name appears in this research report is not registered or qualified as a research analyst with the Financial Industry Regulatory Authority ( FINRA ) and may not be an associated person of UOBKHUS and, therefore, may not be subject to applicable restrictions under FINRA Rules on communications with a subject company, public appearances and trading securities held by a research analyst account. Analyst Certification/Regulation AC As noted above, each research analyst of UOBKH who produced this report hereby certifies that (1) the views expressed in this report accurately reflect his/her personal views about all of the subject corporation(s) and securities in this report; (2) the report was produced independently by him/her; (3) he/she does not carry out, whether for himself/herself or on behalf of UOBKH or any other person, any of the Subject Business involving any of the subject corporation(s) or securities referred to in this report; and (4) he/she has not received and will not receive any compensation that is directly or indirectly related or linked to the recommendations or views expressed in this report or to any sales, trading, dealing or corporate finance advisory services or transaction in respect of the securities in this report. However, the compensation received by each such research analyst is based upon various factors, including UOBKH s total revenues, a portion of which are generated from UOBKH s business of dealing in securities. UOB Kay Hian (Malaysia) Holdings Sdn Bhd (210102-T) Suite 19-02, 19th Floor, Menara Keck Seng, 203 Jalan Bukit Bintang, 55100 Kuala Lumpur, Malaysia. Tel: (603) 2147 1988, Fax: (603) 2147 1983 http://research.uobkayhian.com MCI (P) 116/03/2014 RCB Regn. No. 198700235E Copyright 2015, UOB Kay Hian Pte Ltd. All rights reserved. w w w. u t r a d e. c o m. m y 7