Thursday, April 7, 2011

#Stocks to watch:* IOI Corp, MAA, MEGB, Dijaya

KUALA LUMPUR: Stocks on Bursa Malaysia may see extended consolidation on Thursday, April 7 in the absence of strong positive newsflow and the uninspiring close on Wall Street.

However, oil and gas-related stocks will see sustained investor interest as oil continues to stay at the 2 '' year highs.

On Wall Street, the S&P 500 index inched upward on relatively light volume on Wednesday, with investors adding to winning positions in TECHNOLOGY [] stocks, but avoiding large bets ahead of corporate earnings due next week.

The Dow Jones industrial average'' rose 32.85 points, or 0.27 percent, to close at 12,426.75. The Standard & Poor's 500 Index gained 2.91 points, or 0.22 percent, to 1,335.54. The Nasdaq Composite Index advanced 8.63 points, or 0.31 percent, to 2,799.82.

At Bursa Malaysia, stocks to watch are IOI Corp, MAA HOLDINGS BHD [] (MAAH), Masterskill Education Group Bhd (MEGB) and Dijaya Corp Bhd. Also in focus would be Boustead Heavy Industries Bhd (BHIC) and Berjaya Food Bhd.

IOI Corp shares fell 17 sen to RM5.55, the most since Feb 10 after it was scrutinized by an industry group following allegations about land disputes and illegal deforestation. The Roundtable on Sustainable Palm Oil has given IOI 28 days to respond to the allegations.

MAA Holdings it denied that it is poised to sell a 70% stake in its unit Malaysian Assurance Alliance Bhd to Zurich Insurance Co. Ltd for an estimated RM1.2 billion.

Its shares may retrace after surging 22 sen to RM1.20 with 73.76 million shares done on Wednesday.

The Edge FinancialDaily reports Masterskill Education Group Bhd, the operator of Masterskill University College of Health Sciences, intends to open a branch in Indonesia soon in a move to diversify geographically.

It also reports that the disruption caused by Japan's massive earthquake and tsunami to the automotive industry supply chain could be more serious than expected for the local players.

Meanwhile, it said RHB CAPITAL BHD []'s (RHBCap) strategic shareholder Abu Dhabi Commercial Bank (ADCB) has not officially indicated its intention to exit the Malaysian banking group.

Boustead Heavy Industries Bhd (BIC) targets to double its order book this year, mainly driven by the finalising of its littoral combatant ship (LCS) contract with the Defence Ministry.

Managing director Tan Sri Ahmad Ramli Mohd Nor said BHIC's order book currently is RM1.2 billion. Last October, BHIC received a letter of intent to build six second-generation patrol vessels with combatant capabilities.

Berjaya Food Bhd said it is in early talks on possible investments relating to the company's continued effort to seek opportunity to grow and expand its business as a leading mid-casual dining restaurant operator in Malaysia.

Property-based Dijaya is venturing into the hotel business with US-based Starwood Hotels & Resorts Worldwide, Inc. to develop a W Hotel in Kuala Lumpur.

Dijaya said the 150-room hotel is scheduled to open in 2016 and will mark the entry of the W brand to Malaysia. More details on the outlook and the positive impact on the project in The Edge FinancialDaily.

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