#Stocks to watch:* Benalec, SKW, Prinsiptek, AirAsia

KUALA LUMPUR:'' Regional markets could start off the new week on Monday, Jan 17 on a firmer note after Wall Street closed higher on Friday, as investors' sentiment was underpinned by a bank-led rally.

Reuters said strength in financial stocks helped offset economic reports that showed soft December retail sales and consumer sentiment dented by rising gasoline prices. The market's resilience will be tested next week when a number of banks report results.

The Dow Jones industrial average added 55.48 points, or 0.47%, to 11,787.38. The Standard & Poor's 500 rose 9.48 points, or 0.74%, to 1,293.24. The Nasdaq Composite gained 20.01 points, or 0.73%, to 2,755.30.

US financial markets will be closed on Monday for Martin Luther King Jr. Day.

At Bursa, stocks to watch on Monday include Benalec Holdings Bhd, Syarikat Kayu Wang Bhd (SKW), Prinsiptek Corp Bhd and AIRASIA BHD [].

Benalec, an integrated marine engineering specialist, will be listed on Bursa Malaysia. Its offer price is RM1 per share while AmResearch has a Buy call and a sum of parts-derived fair value of RM1.90.

The research house said Benalec enjoys an 18% share of the Malaysian marine CONSTRUCTION [] market dominated by only five major active players.

Hence, Benalec should trade at a scarcity premium ' the closest peer HOCK SENG LEE BHD [] trades at FY11F-12F PEs of 8 times-10 times versus Benalec's 6 times-8 times (at IPO price of RM1), it said.

'Benalec's highly scalable business model could also serve as a springboard to secure more value-accretive deals, including specialised industrial hubs,' said AmResearch.

SKW has secured a RM129.24 million subcontract for an affordable housing scheme in Alor Setar, Kedah. It said on Friday, Jan 14 that it has accepted a letter of award from B.S. Civil Engineering Sdn Bhd for the subcontract.

Prinsiptek, whose shares had risen recently following positive newsflow, saw a foreign fund, which had been a substantial shareholder for several years, reducing its stake.

UBS AG for the Artradis Barracuda Fund disposed of 5.5 million shares on Jan 10, reducing its stake to 9.53 million shares or 7.52%.

Another filiing showed UBS AG for AB2 Fund ceased to be a substantial shareholder when it disposed of 3.5 million shares on Jan 10.

RHB Research Institute had on Jan 10 issued a positive outlook for the company. It said the the company, having laid low over the last two to three years against a backdrop of a slowdown in the local construction and property sectors, Prinsiptek's earnings are back on the growth path again.

It said the earnmings growth would be underpinned by (1) an expected improved job flow in the construction sector; and (2) its five new property launches. as it believed the construction sector prospects would be bright in 2011, underpinned by rising demand for contracting services on the back of a better job flow and tightening supply for contracting services.

'We have arrived at an indicative fair value of 58 sen for Prinsiptek,' it said. RHB Research valued'' Prinsiptek's construction business at 10 times one-year forward earnings, in line with our one-year forward benchmark target price earnings ratio of 10 to 16 times for the construction sector; and'' its property business by discounting back project cash flows at the 10% property benchmark discount rate.

Last month, Prinsiptek announced it plans to undertake an estimated RM100 million mixed development on a newly acquired leasehold'' land in Section 7, Shah Alam, Selangor.

Prinsiptek said the project involving serviced apartments and shoplots, is expected to generate a profit of approximately RM25 million, based on a development cost of some RM90 million.

In AirAsia, the foreign shareholding increased to 51.55% of its paid-up share capital of 2.77 billion shares as at Dec 30, 2010.'' The low-cost carrier said on Friday, Jan 14 that this was an increase of 3.48% from the 48.07% as at June 30.

DIGI.COM BHD [] has moved closer to its proposal to provide mobile broadband services after it submitted its detailed business plan to the Malaysian Communications and Multimedia Commission (MCMC) on Friday, Jan 14.

Its unit DiGi Telecommunications Sdn Bhd had submitted the plan to the MCMC as part of its application for a spectrum in the 2600MHz band, which is essentially for 4G.

"This is pursuant to MCMC's offer to award 20MHz of this spectrum via apparatus assignment subject to DiGi submitting a suitable business plan," it said.

DiGi said on the 2600MHz spectrum would enable it to provide enhanced mobile broadband services to its customers.

"By utilising long term evolution TECHNOLOGY [], customers/end users will be able to benefit from improved user experience from both higher data speeds and improved service quality," it said.

GLOBAL MARKETS-Stocks rise on JPMorgan results, euro rallies

NEW YORK: World stocks edged up on Friday, Jan 14, with JP Morgan's strong earnings pushing Wall Street higher, but China's latest move to tighten credit drove gold to a one-week low, although oil prices rose.

A rise in Brent crude to above $99 a barrel helped lift U.S. oil prices despite the increase in reserve requirements at Chinese banks.

Wall Street rallied, with the benchmark S&P 500 Index posting its seventh straight week of gains after JPMorgan Chase & Co reported a larger-than-expected 47 percent increase in quarterly earnings.

Although sales at U.S. retailers rose slightly less than expected in December, underlying inflation remained tame and investors were cheered by other data that suggested the recovery was modestly gathering strength.

Retail sales for 2010 reversed two years of contraction with the biggest increase in more than a decade, while the Federal Reserve reported a surprisingly large 0.8 percent gain in output at U.S. factories, mines and utilities in December, helped by cold weather.

The S&P Midcap 400 index, which includes companies with market caps ranging from $750 million to $3.3 billion, surged to end the session at 931.07, an all-time closing high.

"On balance, with supporting prices and in spite of mixed economic data, there is expectation of a strong earnings season," said Jim Awad, managing director at Zephyr Management in New York.

The Dow Jones industrial average rose 55.48 points, or 0.47 percent, to close at 11,787.38. The Standard & Poor's 500 gained 9.48 points, or 0.74 percent, to finish at 1,293.24. The Nasdaq Composite climbed 20.01 points, or 0.73 percent, to end at 2,755.30.

For the week, the Dow rose 1 percent, the S&P 500 added 1.7 percent and the Nasdaq rose 1.9 percent.

U.S. financial markets will be closed on Monday for Martin Luther King Jr. Day.

The fresh tightening in Chinese monetary policy pushed European shares lower, although more positive U.S. economic and earnings data helped pare losses by the close.

Brent crude oil rose to a 27-month peak above $99 a barrel, as traders shrugged off China's move to restrict lending.

In London, ICE Brent crude for February delivery settled up 62 cents, or 0.63 percent, at $98.68 a barrel, having traded as high as $99.20, the highest since October 2008. The February contract expired at the end of Friday's trading.

U.S. crude oil for February delivery added 14 cents, or 0.15 percent, to settle at $91.54 a barrel.

But gold dropped 1 percent to post its biggest two-week loss in nearly a year after China's move to rein in inflation and as safe-haven demand faded on a better economic outlook.

U.S. gold futures for February delivery lost $26.50 to settle at $1,360.50 an ounce. Spot gold fell as low intraday as $1,354.99 an ounce, a one-week low.

U.S. Treasuries slipped as the rise in equity markets boosted risk tolerance and dampened the appeal of safe-haven U.S. government debt.

Retail sales were "fairly strong" and thus mildly negative for safe-haven assets like Treasuries, said Ray Humphries, portfolio manager of The Hartford Inf lation Plus Fund at Hartford Investment Management Co., which has $161.7 billion in assets under management.

The euro headed for its best week in more than 1-1/2 years and could extend gains next week after successful securities auctions by indebted euro-zone members calmed fears of a credit crisis in the region.

The euro was last at $1.3376, up 3.8 percent this week and edging closer to key resistance at $1.35. Analysts said the recovery could continue in the near term, although gains above $1.35 may be difficult, given nervousness over the large debt supply from weaker euro-zone economies in 2011.

"We're at a bit of a pivot point, but the same momentum continues," said Fabian Eliasson, vice president of currency sales at Mizuho Corporate Bank in New York.

The dollar slipped against a basket of major currencies, with the U.S. Dollar Index down 0.16 percent at 79.064. - Reuters

Geithner: real yuan appreciation "substantial"

WASHINGTON: U.S. Treasury Secretary Timothy Geithner said on Friday, Jan 14 there has been a "substantial" inflation-induced appreciation in China's yuan currency that Beijing would do well to recognize and counter.

"Because Chinese inflation is accelerating more rapidly than U.S inflation, the right measure of the pace of appreciation is now more than 10 percent a year, and that is a very substantial, material change," Geithner told reporters at the White House.

In a continuing bid by the Obama administration to persuade China to let the yuan's nominal value rise more rapidly, Geithner opened a new tack earlier this week by saying it would be in China's own interest to do so in order to tamp down inflation in its own economy.

The so-called "real" exchange rate is adjusted to account for the substantial difference between Chinese and U.S. inflation -- 5 percent versus about 1 percent, respectively.

Geithner told an audience on Tuesday that the current "real" pace of appreciation would help correct an exchange-rate imbalance with the U.S. dollar but at an unnecessarily severe cost to China. A stronger yuan in nominal terms could help cap Chinese inflation, Geithner contends.

Geithner spoke to reporters ahead of a Jan. 19 meeting at the White House between Chinese President Hu Jintao and President Barack Obama.

In nominal terms, the yuan has risen about 3.6 percent since China dropped a peg to the dollar in June, touching a record high on Friday. [CNY/]

"The exchange rate has moved up a little over 3 percent ... against the dollar since June of last year. That is an annual rate of about 6 percent, maybe 7, 8 percent a year," Geithner said. "But that is not the best measure of competitiveness ... (which) is the combined effect of that change and the difference between China's inflation rate and ours."

Still, the pace of appreciation has not been enough to please U.S. lawmakers, who argue China deliberately holds down the value of the yuan to gain a trade advantage.

The Treasury Department in October delayed a semi-annual report on the exchange rate practices of major U.S. trading partners, avoiding a decision on whether to label China a currency manipulator.

Treasury is expected to revisit the argument about the difference between real and nominal exchange rates in that report, now expected sometime after the Hu-Obama meeting, but is not expected to pin a "currency manipulator" label on China which could lead to trade actions. - Reuters

US STOCKS-Banks lead S&P 500 to seventh week of gains

NEW YORK: The S&P 500 ended a seventh straight week of gains on Friday ,Jan 14 with a banks-led rally amid healthy volume after encouraging financial results from JPMorgan.

Strength in financial stocks helped offset economic reports that showed soft December retail sales and consumer sentiment dented by rising gasoline prices. The market's resilience will be tested next week when a number of banks report results.

"On balance, with supporting prices and in spite of mixed economic data, there is expectation of a strong earnings season," said Jim Awad, managing director at Zephyr Management in New York.

JPMorgan Chase & Co shares added 1 percent to $44.91 after reporting stronger-than-expected fourth-quarter earnings. Its stock has risen 5.9 percent in the first two weeks of the year..

However, banks' leadership in the market may stall as the sector faces strong technical resistance. Three major indexes -- the KBW bank index, the S&P financial sector and the Select Sector SPDR financial ETF -- approach multimonth highs reached last April.

"If we don't take a break before (moving above) the April highs, we're going to be extended and overbought, so it will be a dangerous breakout," said John Schlitz, chief U.S. market technician at Instinet in New York.

The KBW bank index rose 2.3 percent to 54.70, near a strong resistance area between 57 and 59. Earnings next week from Bank of America, Goldman Sachs and Morgan Stanley will be key for the sector.

"Are we close to a breakout or resistance?," Instinet's Schlitz said. "I'd probably caution towards the latter."

The Dow Jones industrial average added 55.48 points, or 0.47 percent, to 11,787.38. The Standard & Poor's 500 rose 9.48 points, or 0.74 percent, to 1,293.24. The Nasdaq Composite gained 20.01 points, or 0.73 percent, to 2,755.30.

For the week, the Dow ended up 1 percent, the S&P 500 1.7 percent higher and the Nasdaq composite up 1.9 percent. U.S. financial markets will be closed on Monday for Martin Luther King Jr. Day.

Schlitz said the seven weeks of gains on the S&P are a warning sign for declines, which are historically not uncommon in the second half of January. The last time the benchmark rose eight or more weeks in a row was a nine-week run between November 2003 and January 2004.

The S&P Midcap 400 index broke its all-time closing record, rising 0.7 percent to 931.07. The index includes companies with market capitalizations of about $750 million to $3.3 billion.

Higher gasoline prices helped push December consumer prices up at the fastest pace in a year and a half. The high gas price also weighed on consumer sentiment in early January, according to a Reuters/University of Michigan survey.

At $3.09 a gallon, gasoline is the highest since October 2008. Consumer spending noticeably slowed in 2008 as gasoline prices spiked.

Increasing oil prices have contributed to a rise in the S&P energy index, which advanced 1.2 percent to close at the highest since September 2008 in another sign of an overextended market.

Dow component Intel Corp fell 1 percent to $21.08 a day after it posted a better-than-expected quarterly profit and forecast strong revenue for the coming quarter.

For the third consecutive quarter, shares of the chipmaker moved in the opposite direction of the S&P 500 a day after it reported earnings, casting a shadow over the chipmaker's long-standing ability to influence the market. - Reuters

Tenaga chief says nuclear energy option as coal price spikes up

KUALA LUMPUR:'' The recent flooding catastrophe in Australia that pushed up the coal price, further justifies the need for Malaysia to seriously consider nuclear power to generate electricity, TENAGA NASIONAL BHD [] (TNB)president and chief executive officer, Datuk Seri Che Khalib Mohamad Noh said.

"Due to the shortage of gas in the country, we have diversified our electricity generation to include coal.'' Now that there is bad whether in Australia and Kalimantan, as well as severe cold in the Northern hemisphere, the demand for coal, has suddenly shot up but supply is limited.

"There is also a lot of expansion of coal plants elsewhere and all this has combined to cause coal price to spike up'' by more than 50% over the last six months," he said on Satursday, Jan 15.

Coal accounts for 40% of Tenaga's power generation source.

AmResearch in its recent report said, based on the current price that is hovering above US$100 per tonne and the US/RM exchange rate, Tenaga's net profit for financial years 2011 to 2013, could drop by between 28% to 29%.

Tenaga purchased 17% of its annual coal requirement of 18 million tonnes in financial year 2010 from Australia, 71% from Indonesia and 11% from South Africa, said the research house.

Coal accounted for 48% of Tenaga's 2010 financial year fuel cost.

"We estimate that a US$10 increase per tonne in coal costs above our average coal cost projection, could shave Tenaga's 2011 financial net profit by 18%," it explained.

Hence, Che Khalib said, it is timely for the government to seriously look into generating electricty from nuclear power.

"The safety measures, record and TECHNOLOGY [] for nuclear power plants today are far better than that 30 years ago," he added.

He also said that, as the country's largest power producer, TNB supports the government's initiative to establish the Nuclear Power Corporation, as the country can now seriously look into an alternative avenue.

"It is not that we are forcing the country to accept the alternative but we seriously need to look at it and if suitable, be implemented as soon as possible," said Che Khalib.

He also said TNB as an utility company has an interest in supporting the government as the plan is to have the first nuclear plant by year 2021.

"TNB wants secure power generation within the next 10 years and it has to have nuclear power as part of the mix," he added. - Bernama

GLOBAL MARKETS-Stocks rise on JPMorgan results, euro rallies

NEW YORK: World stocks edged up on Friday, Jan 14, with JP Morgan's strong earnings pushing Wall Street higher, but China's latest move to tighten credit drove gold to a one-week low, although oil prices rose.

A rise in Brent crude to above $99 a barrel helped lift U.S. oil prices despite the increase in reserve requirements at Chinese banks.

Wall Street rallied, with the benchmark S&P 500 Index posting its seventh straight week of gains after JPMorgan Chase & Co reported a larger-than-expected 47 percent increase in quarterly earnings.

Although sales at U.S. retailers rose slightly less than expected in December, underlying inflation remained tame and investors were cheered by other data that suggested the recovery was modestly gathering strength.

Retail sales for 2010 reversed two years of contraction with the biggest increase in more than a decade, while the Federal Reserve reported a surprisingly large 0.8 percent gain in output at U.S. factories, mines and utilities in December, helped by cold weather.

The S&P Midcap 400 index, which includes companies with market caps ranging from $750 million to $3.3 billion, surged to end the session at 931.07, an all-time closing high.

"On balance, with supporting prices and in spite of mixed economic data, there is expectation of a strong earnings season," said Jim Awad, managing director at Zephyr Management in New York.

The Dow Jones industrial average rose 55.48 points, or 0.47 percent, to close at 11,787.38. The Standard & Poor's 500 gained 9.48 points, or 0.74 percent, to finish at 1,293.24. The Nasdaq Composite climbed 20.01 points, or 0.73 percent, to end at 2,755.30.

For the week, the Dow rose 1 percent, the S&P 500 added 1.7 percent and the Nasdaq rose 1.9 percent.

U.S. financial markets will be closed on Monday for Martin Luther King Jr. Day.

The fresh tightening in Chinese monetary policy pushed European shares lower, although more positive U.S. economic and earnings data helped pare losses by the close.

Brent crude oil rose to a 27-month peak above $99 a barrel, as traders shrugged off China's move to restrict lending.

In London, ICE Brent crude for February delivery settled up 62 cents, or 0.63 percent, at $98.68 a barrel, having traded as high as $99.20, the highest since October 2008. The February contract expired at the end of Friday's trading.

U.S. crude oil for February delivery added 14 cents, or 0.15 percent, to settle at $91.54 a barrel.

But gold dropped 1 percent to post its biggest two-week loss in nearly a year after China's move to rein in inflation and as safe-haven demand faded on a better economic outlook.

U.S. gold futures for February delivery lost $26.50 to settle at $1,360.50 an ounce. Spot gold fell as low intraday as $1,354.99 an ounce, a one-week low.

U.S. Treasuries slipped as the rise in equity markets boosted risk tolerance and dampened the appeal of safe-haven U.S. government debt.

Retail sales were "fairly strong" and thus mildly negative for safe-haven assets like Treasuries, said Ray Humphries, portfolio manager of The Hartford Inf lation Plus Fund at Hartford Investment Management Co., which has $161.7 billion in assets under management.

The euro headed for its best week in more than 1-1/2 years and could extend gains next week after successful securities auctions by indebted euro-zone members calmed fears of a credit crisis in the region.

The euro was last at $1.3376, up 3.8 percent this week and edging closer to key resistance at $1.35. Analysts said the recovery could continue in the near term, although gains above $1.35 may be difficult, given nervousness over the large debt supply from weaker euro-zone economies in 2011.

"We're at a bit of a pivot point, but the same momentum continues," said Fabian Eliasson, vice president of currency sales at Mizuho Corporate Bank in New York.

The dollar slipped against a basket of major currencies, with the U.S. Dollar Index down 0.16 percent at 79.064. - Reuters

Govt's RM10b strategy to build police quarters, facilities

KUALA LUMPUR: The Minister of Finance Inc's 99.99% owned Pembinaan BLT Sdn Bhd (PBLT) will raise up to RM10 billion to finance the CONSTRUCTION [] of 74 police quarters and facilities.

The first tranche of RM1 billion under the 25-year Islamic medium term notes (IMTNs) will be issued by the first quarter. The book building process is scheduled to take place from Jan 24.

PBLT will build the police quarters and facilities under the "build, lease and transfer" model. When the projects are completed, the government will lease these facilities from PBLT.

The RM10 billion would be raised by PBLT's unit Aman Sukuk Bhd to fund its development costs, financing costs, operating expenses and refinance short term borrowings. Aman Sukuk's IMTN programme has been accorded an 'AAA IS' credit rating by Malaysian Rating Corp Bhd.

PBLT managing director and chief executive officer Mohammed Redza Mohd Yusof said on Friday, Jan 14 under the current BLT model "the private sector is responsible for funding and completing the projects".

"The government will then pay for the completed projects over a longer period of time rather than in one lump sum, which will alleviate the strain on government finances."

To recap, PBLT was established in 2005 in response to the "Report of the Royal Commission to enhance the operation and management of the Royal Malaysia Police".

The Royal Commission identified the unsatisfactory housing and work premises as one of the major challenges facing the police force.

Mohammed Redza also said PBLT targetted to complete 52 projects worth over RM3 billion by 2014.

PBLT has 74 development projects nationwide estimated at nearly RM9 billion in terms of development, financing and operating costs.

PBLT said as at Dec 31, 2010, it had completed 22 projects with another 10 projects partially completed. The gross development cost of these completed projects is RM2.03 billion. The remaining 52 projects are progressing and will be completed in stages up to 2014.

CIMB Investment Bank Bhd is the principal adviser and lead arranger for the IMTN programme.

Bank Islam Malaysia Bhd is the Syariah adviser while the joint lead managers are AmInvestment Bank Bhd, Bank Islam, CIMB, Maybank Investment Bank Bhd and RHB Investment Bank Bhd. Prokhas Sdn Bhd is a consultant to PBLT.

Pos Malaysia, Maybank partner to offer shared banking services

KUALA LUMPUR: POS MALAYSIA BHD [] and MALAYAN BANKING BHD [] have teamed up to provide shared banking convenience for their customers at more than 400 Pos Malaysia outlets.

In the agreement signed on Friday, Jan 14, they said the alliance would enable the bank to provide banking services to more customers, especially the underserved segment, through the extensive network of Pos Malaysia's outlets. The partnership would enable Maybank to especially reach the rural areas of Sabah and Sarawak.

Pos Malaysia group managing director and chief executive officer Datuk Syed Faisal Albar said Pos Malaysia was always looking for opportunities to expand the range of products and services offered at its post office counters such as the shared banking services with Maybank.

Maybank president & CEO Datuk Seri Abdul Wahid Omar said the collaboration reaffirmed Maybank's market leadership and capabilities to offer services to all communities. This would also reinforce its corporate social responsibility and focus on supporting communities especially in the rural areas.

'It is about providing access to financial services and to improve quality of life of the community as well as contribute to the development of the people where we have our presence.

'The initiative is also in line with Maybank's spirit in humanising financial services from the heart of Asean by providing easy access to financial service for the people, as well as providing them with a fair term and pricing and for us to be the heart of the community,' he added.

The three phase implementation programme will see selected Pos Malaysia outlets offer Maybank customers to undertake over the counter bank transactions such as cash deposit and withdrawal for savings account holders and loan repayments in the initial stage.

An automated teller machine would be provided at selected Pos Malaysia outlets to offer banking convenience beyond banking hours as well as additional services such as fund transfer, top-up of mobile credits or 'Touch 'n Go' card.

"By end June 2011, Pos Malaysia services will expand to cover remittance service and opening of savings account,"'' Abdul Wahid said.

Foreign shareholding in AirAsia rises to 51.55%

KUALA LUMPUR: The foreign shareholding of AIRASIA BHD [] increased to 51.55% of its paid-up share capital of 2.77 billion shares as at DEc 30, 2010.

The low-cost carrier said on Friday, Jan 14 that this was an increase of 3.48% from the 48.07% as at June 30.

"The percentage of ownership of shares in the company by foreigners has exceeded the limit of 45% of the company's total issued and paid-up share capital," it said.

AirAsia said shares held by foreigners which exceeded the prescribed limit would be entitled to all rights and entitlements attached to the shares except for the exercise of voting rights.

Syarikat Kayu Wangi secures RM129m Kedah housing subcontract

KUALA LUMPUR: Syarikat Kayu Wang Bhd (SKW) has secured a RM129.24 million subcontract to supply labour , equipment and other necessary items for an affordable housing scheme in Alor Setar, Kedah.

It said on Friday, Jan 14 that it has accepted a letter of award from B.S. Civil Engineering Sdn Bhd for the subcontract.

It said the first phase of the project consisted of three blocks of 11-storey medium-cost apartments'' comprising of 480 units of 800 sq ft per unit. The second phase comprised of seven blocks of 11-storey medium cost apartments comprising 1,120 units of 1,000 sq ft per unit, surau and multipurpose hall and ancillary works.

It said work would be carried out in two phases, with the first phase to start in June 2011 and end in May 2014, while the second phase will start in June 2014 and to be completed in May 2017.

SKW expected the subcontract to contribute positively to its earnings for the financial years ending 2011 to 2017.

DiGi.Com submits detailed biz plan to MCMC for spectrum in 2600MHz band

KUALA LUMPUR: DIGI.COM BHD [] has moved closer to its proposal to provide mobile broadband services after it submitted its detailed business plan to the Malaysian Communications and Multimedia Commission (MCMC) on Friday, Jan 14.

Its unit DiGi Telecommunications Sdn Bhd had submitted the plan to the MCMC as part of its application for a spectrum in the 2600MHz band, which is essentially for 4G.

"This is pursuant to MCMC's offer to award 20MHz of this spectrum via apparatus assignment subject to DiGi submitting a suitable business plan," it said.

DiGi said on the 2600MHz spectrum would enable it to provide enhanced mobile broadband services to its customers.

"By utilising long term evolution TECHNOLOGY [], customers/end users will be able to benefit from improved user experience from both higher data speeds and improved service quality," it said.

According to MCMC, the apparatus assignment is an assignment issued to a person or a company who intend to use or operate telecommunication apparatus in a specific frequency band.

Profit taking sets in, KLCI below 1,570

KUALA LUMPUR: The FBM KLCI closed slightly lower on Friday, Jan 14 as some profit taking emerged in line with relatively muted regional markets, as well as the weaker opening at European markets.

The Nikkei's decline ran counter to early expectations for a rise as brisk earnings from Intel Corp lifted hopes for TECHNOLOGY [] spending, but market participants also said the benchmark was ripe for profit-taking ahead of a three-day weekend in the United States, according to Reuters.

On Bursa Malaysia, the FBM KLCI slipped 0.11% or 1.67 points to 1,569.89, weighed by losses at key blue chips including Genting, Gamuda, CIMB and MMC Corp.

Losers led gainers by 552 to 317, while 275 counters were traded unchanged. Volume was 2.14 billion shares valued at RM2.54 billion.

At the regional markets, the Shanghai Composite Index slumped 1.29% to 2,791.34, Japan's Nikkei 225 0.86% to 10,499.04, Singapore's Straits Times Index 0.30%to 3,245.96 and Taiwan's Taiex 0.03% to 8,972.51. However, Hong Kong's Hang Seng Index rose 0.18% to 24,283.23 and South Korea's Kospi gained 0.89% to 2,108.17.

On Bursa Malaysia, property outfits with exposure in Iskandar Malaysia were among the major losers as inmvestors locked in gains. SP Setia fell 23 sen to RM6.70, UEM Land 14 sen to RM3.11 and Tebrau Teguh 4.5 sen to 90 sen.

Gamuda and MMC Corp fell 13 sen each to RM4 and RM2.94, Genting lost 10 sen to RM11.88, CIMB and Public Bank lost four sen each to RM8.73 and RM13.44, United PLANTATION [] fell 22 sen to RM16.58, BAT 16 sen to RM48.32, KPJ 14 sen to RM3.74 while JT International fell 12 sen to RM6.48.

Gainers included Nestle, PPB, YTL Land, KLK, Tradewinds, IJM and Mah Sing.

SAAG was the most actively traded counter with 62 million shares done. The stock fell one sen to 12.5 sen. Other actives included MUI Industries, Tebrau Teguh, Nam Fatt, IRCB, Ho Wah Genting, JAKS and Ramunia.

Indonesia cbank ready to raise rates as inflation builds

JAKARTA: Indonesia's central bank is ready to hike its benchmark interest rate and sees inflationary pressures continuing to pick up, said governor Darmin Nasution on Friday, Jan 14.

This was the strongest indication yet from Bank Indonesia (BI) that it may need to hike rates from a record low 6.5 percent to head off inflation that hit a 20-month high in December.

"The direction is to raise rates but it will depend on inflation," Nasution told reporters. "BI is ready to find the appropriate time to increase the BI rate."

"Inflationary pressures will continue to pick up and will affect core inflation," he said.

A central bank deputy governor told Reuters last month that BI would not hesitate to tighten policy if core inflation neared 5 percent.

Nasution said the central bank will also let the rupiah strengthen to a certain level in a gradual manner, without giving a level.

Strong investment flows pushed the rupiah up nearly 5 percent last year, helping mitigate inflation by making imports cheaper.

The central bank said last week it was confident that core inflation this year will not surpass 5 percent, in comments that helped trigger a sell-off in the bond and equity market as investors worried the central bank would be behind the curve in tackling inflation.

Analysts have called on the central bank to hike rates by March or April.

"This could be an indication from BI. We expect them to raise rates in March by 25 basis points," said Eric Sugandi, an economist at Standard Chartered in Jakarta. - Reuters

Profit taking picks up pace

KUALA LUMPUR: Profit taking picks up pace in late afternoon on Friday, Jan 14, with the FBM KLCI down nearly five points, weighed down by losses in Genting and property stocks.

At 4.02pm, the FBM KLCI fell 4.99 points to 1,566.57. Turnover was 1.75 billion shares valued at RM2 billion. There were 259 gainers, 602 losers and 254 stocks unchanged.

Genting fell 16 sen to RM11.82 after the recent rally. BAT lost 30 sen to Rm48.18, DiGi 18 sen to RM24.90.

Property players SP Setia and UEM Land, which had rallied as interest in Iskandar Malaysia property picked up, saw investors locking in gains.

SP Setia lost 24 sen to RM6.69 and UEM Land 17 sen to RM3.08.

MARC affirms Tesco Stores Malaysia's RM3.5b debt programme

KUALA LUMPUR: Malaysian Rating Corp Bhd has affirmed its ratings on Tesco Stores (Malaysia) Sdn Bhd's (Tesco Malaysia) RM3.5 billion debt notes with a stable outlook.

The debt notes involve its conventional commercial papers/medium term notes (CP/MTN) facility and Islamic commercial papers/medium term notes (ICP/IMTN) facility at MARC-1(cg)/AAA(cg) and MARC-1ID(cg)/AAAID(cg) respectively.

The outlook for the ratings is stable. The ratings reflect the credit strength of the corporate guarantee provided by its UK-based parent company, Tesco plc for the rated facilities.

Below is the statement issued by MARC on Friday, Jan 14.

Tesco plc carries a public information rating of AAA/stable from MARC premised on the retailer's globally diversified and dominant market position in the grocery retailing industry, its healthy cash flow generation ability, and improved financial metrics.

Tesco Malaysia, a joint venture between Tesco plc (70%) and its Malaysian partner, SIME DARBY BHD [] (30%), has rapidly expanded its network to 37 outlets since commencing operations in 2000.

With a combined retail area of 3.1 million sq ft as at August 2011, it'' adheres to an expansion strategy of opening between three and five hypermarkets annually that has enabled it to maintain a leadership position in the Malaysian retail hypermarket segment with a 30% market share in 2009.

Tesco Malaysia has also benefited from the strong Tesco brand awareness among consumers in urban and suburban areas where its outlets are primarily located.

Tesco Malaysia continues to derive considerable business and technical support from its parent, Tesco plc with an emphasis on supply chain management and product sourcing.

For the financial year ended'' February 28, 2010 (FY2010), Tesco Malaysia recorded 7% revenue and 35% profit before tax growth rates to RM3.53 billion and RM75.7 million respectively year-on-year.

The growth was largely attributed to an 8.3% addition in retail space during the year and a significant reduction in finance costs.

Correspondingly, cash flow from operations (CFO) continued to grow for a third consecutive year; however, free cash flow (FCF) remained negative due mainly to its ongoing hypermarket expansion.

As a result, MARC expects FCF to be in deficit, and Tesco Malaysia would be reliant on refinancing'' or advances from Tesco plc in respect of the redemption of its rated issuances.

MARC notes that parent company has extended financial support to Tesco Malaysia by way of loans, although the subsidiary is expected to service its own debt.

In this respect, MARC believes'' that Tesco Malaysia should be able to meet this requirement given the improving CFO interest coverage which stood at 4.33 times in FY2010 (FY2009: 2.30 times).

Tesco plc recorded a revenue of ''29.8 billion in the 26 weeks ending August 28, 2010 (1HFY2011) (1HFY2010: ''27.8 billion), driven by stronger results from the group's Asian operations that had compensated for lower growth in its domestic market.

Revenue growth in 1HFY2011 was also aided by the weaker British pound against Asian currencies, generating some ''535 million of total revenue. Despite difficulties in several markets, including the US, Ireland and Japan, Tesco plc's pre-tax profits rose to ''1.19 billion in 1HFY2011 (1HFY2010: ''1.03 billion).

Its US operations in particular have continued to suffer, registering a loss of ''95 million in 1HFY2011 (1HFY2010: - ''85 million) due to continued delays in expanding new stores that is seen as critical to Tesco plc's strategy to achieve economies of scale. I

n spite of the setback in the US, Tesco plc added 229 new stores worldwide, increasing its total number to 5,008 stores, and store space by 2.8% to 96.7 million sq ft in 1HFY2011.

MARC notes that Tesco plc has also demonstrated its commitment to reduce its net debt levels, with its total net debt declining to ''7.6 billion, while its debt-to-equity ratio has improved to 0.82 times (FY2009: 0.90 times).

MARC assigns AAA rating to govt-owned Aman Sukuk's RM10b Islamic debt notes

KUALA LUMPUR: Malaysian Rating Corp Bhd (MARC) has assigned a preliminary rating of AAA IS with a stable outlook to the Islamic Medium Term Notes (IMTN) Programme of up to RM10.0 billion by Aman Sukuk Berhad (Aman).

Aman is a special purpose vehicle established to facilitate the issuance of IMTNs on behalf of its parent, Pembinaan BLT Sdn Bhd (PBLT). PBLT, an entity wholly-owned by the Government of Malaysia (GoM), constructs facilities and quarters for the Royal Malaysia Police (Polis DiRaja Malaysia, or PDRM) under a Build, Lease and Transfer project model.

Below is the statement issued by MARC on Friday, Jan 14

The sukuk assets primarily consist of rights, entitlements and benefits to the sublease rental receivables under the sublease agreements pertaining to completed facilities constructed by PBLT for the PDRM. PBLT will dispose of its sukuk assets to Aman via legal assignments.

The proceeds from IMTNs issued under the programme will be used to finance development costs of various projects of PBLT, its operating expenses, financial costs and repayment of existing borrowings.

Each series of notes is essentially secured by and serviced from defined sublease rental payments made by the GoM pursuant to the terms of respective sublease agreements for identified completed facilities.

The repayment profile of the IMTN series will be structured to match the sublease payments made by the GoM under various facility leases and subleases to ensure full and timely servicing and repayment.

The sublease payments due on a particular sublease represent an independent obligation of the GoM; they are not affected by other existing and/or future subleases on other completed facilities and/or facilities to be completed by PBLT.

The assigned rating of AAAIS is based on the credit profile of single obligor and sublessee which is the GoM, given that its capacity to make the defined contractual sublease payments under the respective sublease agreements is derived from federal government annual budgetary allocations.

The rating also reflects the irrevocable nature of sublease payment obligations; the GoM cannot terminate the sublease agreements and is obliged to make the sublease payments under any circumstances.

The transaction structure eliminates commingling risk by ensuring that the GoM makes sublease payments directly into a collection account that will be jointly maintained by an appointed security agent and the issuer without passing through PBLT's bank accounts.

All operational risk related to the maintenance of the facilities has been transferred to the sublessee. Additionally, noteholders are insulated from PBLT's performance risk; the GoM has no right to set-off claims resulting from covenant breaches and impairment of the facilities against the sublease receivables.

MARC is satisfied that the originator's performance and credit profile is not a significant factor in this government sublease-receivables backed transaction.

Notwithstanding, MARC notes the federal government's commitment to provide PBLT full reimbursement of its costs and implied obligation to provide adequate financial support to a wholly-owned entity.

Malaysia Marine and Heavy Engineering MD quits to join Petronas

KUALA LUMPUR: The managing director and chief executive officer (CEO) of Malaysia Marine and Heavy Engineering Holdings Bhd (MMHE) Wan Yusoff bin Wan Hamat is resigning with effect from Feb 1.

A company statement said on Friday, Jan 14 that he will take up a new appointment within the Petroliam Nasional Bhd group (Petronas) where he will heading a major project development in Malaysia.

Taking over from Wan Yusoff is an executive committee member of Technip, Dominique de Soras, who is'' an executive committee member of Technip, the strategic investor of MMHEc that holds 8% of its issued share capital.

'The appointment was approved by the board in view of de Soras's technical credentials and extensive experience in the oil and gas industry, and to further support the collaboration between MMHE and Technip,' MMHE said.

China's shares end down, weighed by tightening talk

SHANGHAI: China's key stock index closed down 1.3 percent on Friday, Jan 14 and was down 1.7 percent for the week as speculation of further policy tightening by Beijing as early as this weekend kept investors on the back foot.

But some analysts said the chances of a rate rise in the coming days were slim ahead of key economic data due next week.

The benchmark Shanghai Composite Index fell to 2,791.3 points after a 0.2 percent rise on Thursday. ($1 = 6.60 yuan).

In SEOUL: Seoul shares rose 0.9 percent on Friday buoyed by firm gains in financials and auto issues including Hana Financial Group and Hyundai Motor, but losses in crude oil refiners such as SK Energy weighed.

The Korea Composite Stock Price Index (KOSPI) ended up 0.89 percent at 2,108.17 points.

"Now that a lot of uncertainties that had pervaded the market have been cleared, upside momentum has revived," said Kim Hyoung-ryoul, a market analyst at NH Investment & Securities.

Shares in Hyundai Motor Co, South Korea's top automaker, rose 4.43 percent to 200,500 won, after hitting an intraday record high of 203,000 won, following its launch of new Grandeur sedan in the domestic market.

Analysts said the launch raised hopes the higher-margin model would improve its profit, analysts said.

Hyundai said it aimed to sell 100,000 redesigned Grandeur sedans globally this year.

Shares in Kia Motors rose 1.2 percent.

Crude refiners lost ground after media reports quoted South Korean President Lee Myung-bak as saying investigation into domestic oil product prices were necessary due to their high prices and impact on domestic consumer prices.

"President Lee's comment weighs on sentiment, but it is not likely to directly affect refining margins," said Park Jae-cheol, an analyst at Mirae Asset Securities.

"Pricing of gasoline may be impacted, but other types of oil products should track market trends," Park added.

Shares in SK Energy fell 3.08 percent and S-Oil lost 2.99 percent. GS Holdings, the holding company of GS Caltex, South Korea's No.2 crude oil refiner, shed 2.11 percent.

But financial plays continued gains buoyed by expectations of a series of interest rate rises, following Bank of Korea's rate increase decision on Thursday.

Shares in Shinhan Financial Group rose 2.3 percent and Hana Financial Group 4.7 percent.

Insurers also advanced as they have substantial holdings in interest bearing assets. Samsung Life rose 3.3 percent and Korea Life climbed 0.6 percent.

Shares in Korea Express spiked 14.5 percent after POSCO said it was considering purchasing a stake in the logistics firm.

But shares in POSCO fell 1 percent pressured by its disappointing set of fourth quarter earnings on Thursday.

The world's No.3 steelmaker posted a weaker-than-expected quarterly profit and warned it was struggling to pass on rising costs as floods in Australia disrupt raw material supplies.

Tong Yang Major jumped 5 percent after the company said late on Thursday it plans to make a share offering worth around 325.8 billion won, easing fears about the firm's financial health.

Firm gains in shipyards helped, as shares in Hyundai Heavy Industries rose 2.8 percent and Daewoo Shipbuilding & Marine Engineering advanced 3.2 percent.

Elsewhere, the won currency's strength lifted tour agencies.

Hana Tour, an on-and-offline tour agency, rallied 7.2 percent and Modetour gained 6.3 percent.

The KOSPI 200 March futures index rose 2.65 points to 278.0 points. The KOSPI 200 spot index gained 2.65 points to 278.17. - Reuters

''

FBM KLCI remains in the red at mid-day

KUALA LUMPUR: The FBM KLCI remained in negative territory at the mid-day break on Friday, Jan 14 as key Asian markets traded mixed following the weaker overnight close at Wall Street.

Asian shares were generally softer as investors took profits on recent sharp gains and as a pullback in oil and metals prices hit stocks of resource companies, according to Reuters.

Japan's Nikkei average slipped 0.3%, a day after hitting an eight-month high, while stocks elsewhere in Asia edged down 0.1%, it said.

On Bursa Malaysia, the 30-stock FBM KLCI fell 0.16% or 2.58 points to 1,568.98 at 12.30pm, weighed by losses at select blue chips.

The broader market was weak with losers outpacing gainers by 505 to 283, while 260 counters traded unchanged. Volume was 1.19 billion shares valued at RM1.23 billion.

The ringgit weakened 0.06% to 3.0564 versus the greenback; crude palm oil for the third month delivery rose RM7 per tonne to RM3,662, crude oil fell 38 cents per barrel to US$91.02 while gold gained US$3 per troy ounce to US$1,376.77.

At the regional markets, Japan's Nikkei 225 fell 0.35% to 10,552.72, the Shanghai Composite Index down 0.94% to 2,801.12, Singapore's Straits Times Index slipped 0.69% to 3,233.44, and Taiwan's Taiex down 0.19% to 8,958.26.

Meanwhile, Hong Kong's Hang Seng Index edged up 0.20% to 24,286.30 and South Korea's Kospi was up 0.40% to 2,097.78.

On Bursa Malaysia, ''United PLANTATION []s was the top loser this morning and fell 28 sen to RM16.52; Batu Kawan lost 10 sen to RM17.12, Boustead fell six sen to RM5.85, while KLK, United Malacca and TH Plantations fell four sen each to RM22.34, RM7.10 and RM2.16 respectively.

BAT lost 28 sen to RM48.20, S P Setia 21 sen to RM6.70, Dutch Lady 16 sen to RM17.44, SapuraCrest 15 sen to RM3.46, UEM Land 14 sen to RM3.11, while Petronas Dagangan, KPJ and YTL fell 12 sen each to RM12.16, RM3.76 and RM8.30.

Other decliners included Genting, CIMB, Gamuda and MMC Corp.

Mudajaya topped the gainers and was up 17 sen to RM5.37; Wah Seong gained 14 sen to RM2.40, Nestle and Daiman added 12 sen each to RM45.30 and RM1.97, while Mah Sing, JT International, YTL Land, Tradewinds and Hap Seng rose 10 sen each to RM2.21, RM6.70, RM1.79, RM7.56 and RM6.40 respectively.

Tebrau was the most actively traded counter with 38.74 million shares done. The stock added one sen to 95.5 sen. Other actives included SAAG, IRCB, JAKS, Ho Wah Genting, Ramunia and Borneo Oil.

MUI unit gets BNM nod to start talks to dispose shares in insurance biz

KUALA LUMPUR: MALAYAN UNITED INDUSTRIES BHD []'s (MUI) wholly owned unit Novimax (M) Sdn Bhd has been given the nod by Bank Negara Malaysia to start preliminary negotiation with US-based Liberty International Holdings Inc to dispose its shares in MUI Continental Insurance Bhd (MCI).

MCI is a 52.21% owned subsidiary of Novimax.

MUI said on Friday, Jan 14 the approval dated Jan 5 from Bank Negara was subject to both parties concluding the negotiation within six months from the date of approval.
'The approval in principle as stated above is not to be taken as approval for the proposed disposal.

The relevant parties would be required to seek prior approval of the Minister of Finance, with the recommendation of Bank Negara before entering into any agreement to effect the proposed disposal,' said MUI.

At 10.43am, MUI was up one sen to 23 sen with 14 million shares done.

FBM KLCI retreats at mid-morning

KUALA LUMPUR:'' The FBM KLCI slipped into negative territory in early trade on Friday, Jan 14 in line with the overall decline at key regional markets following the weaker overnight close at Wall Street.

At 10am, the FBM KLCI was down 1.54 points to 1,570.02, weighed by losses at including the Genting group, CIMB, Gamuda and BAT.

Gainers trailed losers by 239 to 282 while 235 counters traded unchanged. Volume was 503.13 million shares valued at RM396.28 million.

At the regional markets, Singapore's Straits Times Index fell 0.81% to 3,229.53, the Shanghai Composite Index lost 0.66% to 2,808.91, Japan's Nikkei 226 lost 0.29% to 10,558.93, South Korea's Kospi fell 0.24% to 2,084.51, Taiwan's Taiex shed 0.15% to 8,962.01 while Hong Kong's Hang Seng Index opened little changed at 24.257.21.

Maybank Investment Bank Bhd head of retail research and chief chartist Lee Cheng Hooi in a note Jan 14 said that due to the softer US markets last night, the FBM KLCI could be in a profit-taking mood today ahead of the weekend, with rotational buying in the mid-cap and lower liner stocks, beside blue-chip strength being trimmed by later cashing-in of intraday gains.

On Bursa Malaysia, BAT was the top loser at mid-morning and fell 32 sen to RM48.16; United PLANTATION []s fell 28 sen to RM16.52, Dutch Lady and S P Setia lost 16 sen each to RM17.44 and RM7.66, UEM Land down 12 sen to RM3.13, Sungei Bagan 11 sen to RM3.20, Allianz lost 10 sen to RM5.10, Shell and CBIP eight sen each to RM10.70 and RM4.17, Genting and Genting Malaysia down six sen each to RM11.92 and RM3.59, while CIMB and Gamuda lost two sen each to RM8.75 and RM4.11.

The top gainer was JT International which rose 20 sen to RM6.80; IJM added 17 sen to RM6.69, Tradewinds 13 sen to RM7.59, Nestle 12 sen to RM45.30, DFZ and Suria Capital up 11 sen each to RM3.65 and RM2.39, QSR and Mudajaya up 10 sen each to RM5.53 and RM5.30, while Faber added nine sen to RM2.28.

Wah Seong jumped 16 sen to RM2.42 as work on the RM550 million-Gorgon LNG coating contract takes off.

ECM Libra Research said with orderbook growth from increased capex spend over 2011, Wah Seong should be re-rated to +1 standard deviation PE of 18x which was seen in previous rally in 2007 and 2009.

'As such, we peg its FY11 EPS to the 18x PE target to derive our revised target price of RM2.70 (previously RM2.09),' it said.

Tebrau was the most actively traded counter with 26.99 million shares done. The stock added one sen to 95.5 sen. Other actives included JAKS, Ramunia, Borneo Oil, Ho Wah Genting, Karambunai, Pentamaster and Hubline.

HDBSVR: FBM KLCI may be rangebound

KUALA LUMPUR: Hwang DBS Vickers Research said key U.S. equity bellwethers shed between 0.1% and 0.9% at the closing bell on Thursday, Jan 13 due to the higher-than-expected initial jobless claims.

It said on Friday, Jan 14 the FBM KLCI will probably take the cue from the Wall Street's performance last night with some profit taking activities after seeing a two-day rally.

'The benchmark index may range-bound with a slight downside bias. Nevertheless, we think the index will remain firm above its support level of 1,550,' it said.

The stocks to watch'' are Suria Capital, after its wholly owned subsidiary and consortium partners have been awarded a RM1 billion EPCC contract for a power plant project in Sabah.

Alsoin focus will be water CONSTRUCTION [] specialists such as George Kent, Ranhill, Gamuda and MMC as the federal government is expected to call for tenders for the construction of Langat 2 water treatment plant in Selangor after the state government has agreed to the project.

RHB Research ups SP Setia share to RM8.05 from RM6.95

KUALA LUMPUR: RHB Research said the boost in SP Setia's share price has prompted it to relook at its valuations.

It said on Friday, Jan 14 that instead of using its previous revised net asset value (RNAV) based valuations, it changed its valuation methodology to price-to-earnings.

'From our quantitative analysis, SP Setia's historical forward PE is highly correlated (correlation factor 0.9) to the new property sales.

'Given the high correlation, this suggests that target price based on PE is hence meaningful. Based on SP Setia's sales target of RM3bn for this year, the forecast PE is actually 30x,' it said.

RHB Research said based on a PE of 30x, it raised its indicative to RM8.05 (from RM6.95). Maintain Outperform.

Suria Capital surges on RM1b contract

KUALA LUMPUR: Shares of Suria Capital Bhd surged in early trade on Friday, Jan 14 after its unit's consortium secured a RM1 billion contract to build a 300MW power plant in Kimanis, Sabah.

At 9.05am, it was up 16 sen to RM2.44 with 728,500 shares done.

The FBM KLCI rose 0.58 of a point to 1,572.14. Turnover was 73.35 million sahres done valued at RM58.77 million. There were 188 gainers, 50 losers and 128 stocks unchanged.

Suria Capital's unit SCHB Engineering Services Sdn Bhd and its partners CTCI Corporation, CTCI Overseas Corporation Ltd, CTCI Malaysia Sdn Bhd and Steamline (Malaysia) Sdn Bhd were awarded the contract by Kimanis Power Sdn Bhd.

The CONSTRUCTION [] period will be around three years. Suria Capital expects the contract to contribute positively to the earnings of SCHB Engineering for the financial year ending Dec 31, 2011.

Wah Seong climbs as work on Gorgon LNG coating contract takes off

KUALA LUMPUR: Shares of Wah Seong Corp Bhd climbed in early trade on Friday, Jan 14 as work on the Gorgon LNG coating contract takes off.

At 9.15am, the shares rose nine sen to RM2.35 with 1.25 million shares done. Its call warrants, Wah Seong-CA added 2.5 sen to 8.5 sen.

The FBM KLCI rose 0.27 of a point to 1,571.83. Turnover was 177.81 million shares done valued at RM145.06 million. There were 231 gainers, 99 losers and 168 stocks unchanged.

ECM Libra Research said after the delays faced by the Gorgon LNG coating contract over 2HCY10, Wah Seong noted that the project is now in progress and is still slated for completion in 1QCY12 as originally planned.

Only 10% of the job has so far been completed. The Gorgon project is worth RM550 million and will yield margins of up to 20% at gross level.

'We raise our estimates for FY11 by 14.9% to account for an improvement in the engineering segment, full year contribution from Gorgon and also new jobs that may trickle in at the end of FY11,' it said.

ECM Libra Research said with orderbook growth from increased capex spend over 2011, Wah Seong should be re-rated to +1 standard deviation PE of 18x which was seen in previous rally in 2007 and 2009.

'As such, we peg its FY11 EPS to the 18x PE target to derive our revised target price of RM2.70 (previously RM2.09),' it said.

SP Setia, UEM Land retreat

KUALA LUMPUR: Shares of SP SETIA BHD [] and UEM Land, which had rallied following upgrades by analysts and due to their exposure to the Iskandar Malaysia region, shed some recent gains as investors locked in gains.

At 9.30am, SP Setia was down 14 sen to RM6.79 with 429,800 shares despite a positive outlook by RHB Research Institute. The research house said that based on a PE of 30 times, it raised its indicative price to RM8.05 from RM6.95 and it also maintained an Outperform of the stock.

UEM Land shed nine sen to RM3.16 with 1.38 million shares done.

The FBM KLCI fell 1.45 points to 1,570.11. Turnover was 297.85 million shares valued at RM232.23 million. There were 222 gainers, 171 losers and 212 stocks unchanged.

''

Merck, materials drag Wall St lower, Intel up late

NEW YORK: U.S. stocks edged lower on Thursday, Jan 13, hurt by a slide in drugmaker Merck and as falling commodities prices hit shares of natural resource companies.

The S&P 500, however, held near 28-month highs as investors saw stocks' upward trend continuing, focusing on expectations for strong earnings.

Intel Corp confirmed those bets as it posted better-than-expected quarterly earnings and forecast strong revenue for the coming quarter after the closing bell. Its shares rose 2.7 percent to $21.87 following a 0.06 percent dip during regular trading hours.

During Thursday's session copper prices retreated from recent highs on concerns of slowing demand from China. Freeport McMoRan Copper & Gold lost 3.1 percent to $118.07, and the S&P materials sector fell 0.8 percent..

"The fact the commodities market is trading down is what's putting pressure on materials shares," said Tom Schrader, managing director of U.S. equity trading at Stifel Nicolaus Capital Markets in Baltimore.

Merck & Co dropped 6.6 percent to $34.69, accounting for more than half the losses in the Dow industrials, after it stopped giving a blood clot preventer, one of its most important experimental drugs, to some patients..

The S&P healthcare index fell 0.54 percent.

Weekly initial jobless claims jumped to their highest level since October last week while food and energy costs lifted producer prices in December, pointing to headwinds for an economy that has shown fresh vigor.

A surge in exports to their highest level in two years helped narrow the U.S. trade deficit in November, an encouraging sign for positive surprises in the current earnings season.

The Dow Jones industrial average fell 23.54 points, or 0.20 percent, to 11,731.90. The Standard & Poor's 500 Index dropped 2.20 points, or 0.17 percent, to 1,283.76. The Nasdaq Composite Index dipped 2.04 points, or 0.07 percent, to 2,735.29.

The benchmark S&P 500 has gained 22.3 percent since the start of September.

About 7.57 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, below last year's estimated daily average of 8.47 billion.

Advancing stocks trailed declining ones on the NYSE by 1,363 to 1,622, while on the Nasdaq, more than 5 stocks fell for every four that rose.

JPMorgan fell 0.6 percent to $44.45 ahead of its results, expected before the market's open on Friday. Its shares have risen 4.8 percent so far this year.

Earnings from S&P 500 companies are expected to rise 32 percent in the fourth quarter compared to a year ago.

Despite Intel's beat and the rise in its shares, S&P 500 futures were flat late Thursday. In the previous two quarters when the TECHNOLOGY [] bellwether beat Wall Street estimates, the broad U.S. stocks benchmark ended the sessions in the opposite direction as Intel shares.

Marathon Oil Corp gained 6 percent to $42.98 after it said it would spin off its refinery and pipeline operations into a stand-alone company..

Easing recent worries about the credit crisis in Europe, Spain and Italy followed Portugal with successful debt sales on Thursday. The euro rose 1.7 percent against the U.S. dollar, its best day in six months. - Reuters

Euro has best day in six months, US stocks fall

NEW YORK: The euro surged on Thursday, Jan 13, taking on renewed vigor after better-than-forecast debt auctions by Spain and Italy and a hawkish rate view from the ECB but weak U.S. jobless claims data weighed on U.S. stocks.

Wall Street struggled from the start of the day, trading in tight ranges before closing lower. Stocks in Tokyo are poised to open weaker after closing at an eight-month high on Wednesday. The Nikkei March futures contract traded in Chicago was down 30 points at 10,590.

The euro got an extra boost after European Central Bank President Jean-Claude Trichet said the euro-zone economy faces short-term inflationary pressures. The ECB had earlier left interest rates unchanged at 1 percent.

"He sent a mild warning to markets that the ECB's assessment on interest rates could change," said Commerzbank economist Michael Schubert.

Oil prices see-sawed but ultimately closed lower on the day, undermined by the jobless claims report and the prospect OPEC would raise output should prices break above $100 a barrel for an extended period.

Grain prices in Chicago traded touched their highest levels in 2-1/2 years on food price inflation and supply concerns.

Gold prices fell after being unable to benefit from a weaker U.S. dollar.

European shares closed lower, although Spanish banks provided a pocket of strength following the solid sovereign bond auctions in Spain and Italy on Thursday. These followed a relatively easy sale of Portuguese debt on Wednesday.

Trichet and the auctions helped the euro score its best day vs. the greenback in six months, rising 1.69 percent to $1.3357.

"We can make another run probably to just above $1.34, after which I would look to fade the move," said Paresh Upadhyaya, head of Americas G10 FX Strategy at BofA Merrill Lynch Global Research in New York.

"From a longer-term perspective, the factors that are at play are euro negative. Funding concerns will continue to weigh on the euro in the first quarter."

Against the Swiss franc, the euro reached a new 1-month high to trade at 1.2876 francs.

The dollar fell 0.17 percent against the Japanese yen to trade at 82.80. Against a basket of currencies, made up of its major trading partners, the U.S. dollar fell 1.07 percent.

U.S. light sweet crude oil fell 46 cents to settle at $91.40 per barrel. Spot gold prices fell $12.15, or 0.88 percent, to $1,373.80 an ounce.

STOCKS SLIP ON JOBLESS CLAIMS

A surprisingly large increase in new weekly claims for U.S. jobless benefits soured the mood in the U.S. stock market while food and energy costs lifted December producer prices.

The claims rose to 445,000 from 410,000 in the prior week, the biggest one-week climb in about six months, which countered expectations for a small drop.

U.S. stocks closed lower. The Dow Jones industrial average fell 23.54 points, or 0.20 percent, to 11,731.90. The Standard & Poor's 500 Index lost 2.20 points, or 0.17 percent, to 1,283.76. The Nasdaq Composite Index dropped 2.04 points, or 0.07 percent, to 2,735.29.

Shares of drugmaker Merck & Co fell 6.62 percent to $34.69 after it said it would pull a blood clot drug from one study and not give it to some patients in a late-stage trial. Vorapaxar, seen as having large sales potential, was deemed inappropriate for stroke patients.

Intel Corp's stock gained 1.5 percent to $21.61 after the closing bell, following the TECHNOLOGY [] bellwether's results and forecast, which exceeded expectations. Intel ended regular trading down slightly at $21.29 a share.

The FTSEurofirst 300 index of top European shares closed down 0.57 percent at 1,157.34 points after jumping 1.5 percent to a 28-month high in the previous session.

Spain's Banco Santander and BBVA climbed 4.79 percent and 6.32 percent respectively. Madrid sold 3 billion euros of 5-year bonds. Rome sold 6 billion euros of 5- and 15-year debt.

European mining shares were among the top decliners as key base metals prices fell. Copper slipped after two days of strong gains on worries about waning demand in top metals consumer China, which is approaching its new year holidays.

The STOXX Europe 600 Basic Materials index fell 1.84 percent.

MSCI's All-Country World index hung on to gain 0.46 percent, ending at 336.72, a fresh 28-month high.

In the debt markets, euro-zone interest-rate futures fell while two-year German bond yields rose to their highest levels since December as traders raised bets on a future interest- rate hike after Trichet's hawkish comments on inflation.

The two-year German Schatz yield rose to a 3-1/2-week high of 1.114 percent after Trichet said the bank had not precommitted not to move rates and added that they had hiked rates in July 2008 as the financial crisis got under way.

The U.S. 10-year Treasury note rose 19/32 of a point in price, pushing the yield down to 3.299 percent. - Reuters

Intel results and forecast beat estimates

SAN FRANCISCO: Intel Corp cheered investors with a strong quarterly revenue forecast and better-than-expected fourth-quarter earnings as sales to corporations grew, according to Reuters on Thursday, Jan 13.

Intel posted an 8 percent increase in fourth-quarter revenue and forecast revenue of $11.1 billion to $11.9 billion in the first three months of 2011.

The fourth-quarter revenue slightly exceeded the $11.37 billion expected by analysts, according to Thomson Reuters I/B/E/S. Analysts, on average, had expected revenue of $10.73 billion in the first three months of 2011.

"It seems like they're doing pretty well. The stock's not really reacting off of it. Right now there's just a larger overhang over the stock when it comes to tablets and smartphones. That may be an area where investors are more cautious," said Patrick Wang, an analyst at Wedbush Securities.

Intel had a record gross margin of 67.5 percent in the fourth quarter, compared to 66.7 percent expected by analysts.

It forecast a gross margin of 64 percent in the current quarter, plus or minus two percentage points. Analysts had forecast a first-quarter gross margin of 63.5 percent.

Last week, Intel unveiled its newest personal computer microchip, code-named Sandy Bridge and seen as a major leap in processing power, and Chief Executive Paul Otellini has said computer manufacturers are rapidly adopting them.

Intel said net income totaled $3.4 billion, or 59 cents a share, in the fourth quarter, compared with 53 cents per share expected by analysts.

Shares of Intel rose 1.5 percent to $21.61 in after-hours trading, after closing down 0.06 percent at $21.29 on Nasdaq.

Major TECHNOLOGY [] companies are expected to keep up sales and profit growth in 2011, but economic troubles in the United States and Europe could temper their results. - Reuters

RIM shares jump after India deal; new phones leaked

TORONTO: Shares of Research In Motion jumped as much as 4 percent to near an eight-month high on Thursday, Jan 13 after it reached a deal with India that appeared to protect its secure corporate email service.

In addition, tech website Boy Genius Report published details of three unreleased BlackBerry smartphones with a new TECHNOLOGY [] that allows consumers to pay for purchases by waving the phone against a special terminal.

RIM declined to comment directly on the Boy Genius report, but said it plans to incorporate so-called near-field communications, or NFC, technologies in future products and will give more details later.

In India, where RIM is fending off government demands it allow monitoring of communications sent via BlackBerry smartphones, the Canadian company said it had allowed access to its Messenger service. But it repeated that it was unable to make changes to allow monitoring of secure corporate emails. [ID:nSGE70CB4R]

"The India uncertainty has been a question mark for RIM given the country's rapid growth. The agreement alleviates the uncertainty," said Kevin Restivo, an analyst with IDC.

The shares retreated from a morning bounce to close 0.8 percent higher at $64.01 on Nasdaq and 1 percent higher at C$63.29 on the Toronto Stock Exchange.

RIM's share price has jumped around 50 percent since late August, buoyed by optimism over its PlayBook tablet, which is powered by a Texas Instruments dual-core processor and is expected to launch in March.

The devices showed by Boy Genius included an updated version of the Torch -- a touchscreen and slide-out keyboard phone launched in August. The model offers double its predecessor's processing power, the report said.

The two other phones shown were a touch-and-type smartphone code-named BlackBerry Dakota and a new version of the mid-range Curve codenamed "Apollo." The Dakota maintains the style of the company's high-end BlackBerry Bold, and features a 2.8-inch touchscreen and RIM's physical qwerty keyboard,

INDONESIA LATEST HEADACHE

The Canadian company generates a growing share of its revenue outside North America and Western Europe and faces pressure in established markets from Apple's iPhone and devices running Google's Android operating system.

Governments in some of these markets, including India, Saudi Arabia and the United Arab Emirates, have demanded access to encrypted BlackBerry data, concerned about the effect confidential communications has on security and social mores.

The latest country to raise the issue is Indonesia, a booming market with between 2 million and 3 million BlackBerry users.

RIM on Monday agreed to filter pornography on Internet browsers on its phones in Indonesia after being threatened with a shutdown of its service.

That threat was made by the country's communications and information minister, Tiffatul Sembiring, who is considered an Islamic conservative. He later claimed RIM does not pay any tax in Indonesia.

RIM denied that on Thursday and said it pays all applicable taxes as an importing manufacturer in the region.

RIM opened a new office in Jakarta in November and is hosting its pan-Asian developers conference on the Indonesia island of Bali. - Reuters

#Stocks to watch:* Suria Capital, Faber, Hubline, chip makers

KUALA LUMPUR: Despite the lower close on Wall Street overnight, stocks on Bursa Malaysia which could see trading interest on Friday, Jan 14 include Suria Capital Bhd, FABER GROUP BHD [], HUBLINE BHD [] and chip makers like MALAYSIAN PACIFIC INDUSTRIES [] Bhd and Unisem Bhd.

On Wall Street, US stocks edged lower on Thursday, hurt by a slide in drugmaker Merck and as falling commodities prices hit shares of natural resource companies.

The S&P 500, however, held near 28-month highs as investors saw stocks' upward trend continuing, focusing on expectations for strong earnings.

According to Reuters, the Dow Jones industrial average fell 23.54 points, or 0.20%, to 11,731.90. The Standard & Poor's 500 Index dropped 2.20 points, or 0.17%, to 1,283.76. The Nasdaq Composite Index dipped 2.04 points, or 0.07%, to 2,735.29.

The benchmark S&P 500 has gained 22.3% since the start of September

Meanwhile, Intel posted an 8% increase in fourth-quarter revenue and forecast revenue of US$11.1 billion to US$11.9 billion in the first three months of 2011.

The fourth-quarter revenue slightly exceeded the US$11.37 billion expected by analysts, according to Thomson Reuters I/B/E/S. Analysts, on average, had expected revenue of $10.73 billion in the first three months of 2011.

Intel had a record gross margin of 67.5 percent in the fourth quarter, compared to 66.7 percent expected by analysts.

The firmer earnings from Intel should shore up interest in chip makers MPI and Unisem also related tech stocks.

The Edge FinancialDaily reports on Friday that as the spotlight turns on the RM4.26 billion acquisition by MALAYAN BANKING BHD [] of Singapore broker Kim Eng Holdings Ltd, changes are quietly taking place in a small corner of the local stockbroking scene involving the standalone brokers.

Suria Capital and its partners have secured a RM1 billion contract to build a 300MW power plant in Kimanis, Sabah.

Its unit SCHB Engineering Services Sdn Bhd and its partners CTCI Corporation, CTCI Overseas Corporation Ltd, CTCI Malaysia Sdn Bhd and Steamline (Malaysia) Sdn Bhd were awarded the contract by Kimanis Power Sdn Bhd.

The CONSTRUCTION [] period will be around three years. Suri Capital expects the contract to contribute positively to the earnings of SCHB Engineering for the financial year ending Dec 31, 2011.

In Faber, The Edge FinancialDaily reports growing concerns on its earnings prospects sparked heavy selling on Faber Group Bhd shares after the group's two integrated facilities management (IFM) contracts in Abu Dhabi were not renewed by the authorities in the Gulf.

RAM Rating Services Bhd has reaffirmed the ratings of Hubline Bhd's RM220 million debt notes but revised the outlook on the long-term ratings from stable to negative.

Hubline's core business is the provision of container and dry-bulk shipping services as well as vessel chartering.

RAM Ratings said the revision in outlook is premised on our concerns that the group's financial performance may remain depressed by weak freight rates (for both its container and dry-bulk shipping segments) and poor dry-bulk cargo volumes.

'Large incoming supply of newbuilds will further pressure freight rates which have yet to stage a meaningful recovery. At the same time, uncertainties in economic recoveries of advanced economies may further dampen market outlook,' said the ratings agency.

In Metronic Global, its executive vice chairman Abd. Gani Yusof sold 100 million shares or 15.75pct at 6.6 sen each on Wednesday.

SEG INTERNATIONAL BHD [] declared a special dividend of 14 sen per share which will go ex on Jan 27 while its entitlement date is Jan 31.

RAM Ratings lowers outlook of Hubline on weak freight rates

KUALA LUMPUR: RAM Rating Services Bhd has reaffirmed the ratings of HUBLINE BHD []'s RM220 million debt notes but revised the outlook on the long-term ratings from stable to negative.

The debt notes involved the long- and short-term ratings of A2 and P1 for Hubline's RM150 million Murabahah commercial papers/medium-term notes programme (2005/2012).

Concurrently, the A2 rating of its RM70 million Bai' Bithaman Ajil Islamic bonds (2005/2012) has also been reaffirmed.

Hubline's core business is the provision of container and dry-bulk shipping services as well as vessel chartering.

'The revision in outlook is premised on our concerns that the Group's financial performance may remain depressed by weak freight rates (for both its container and dry-bulk shipping segments) and poor dry-bulk cargo volumes.

'Large incoming supply of newbuilds will further pressure freight rates which have yet to stage a meaningful recovery. At the same time, uncertainties in economic recoveries of advanced economies may further dampen market outlook,' said the ratings agency.

RAM Ratings said amid the global economic downturn, Hubline's revenue and operating profits had been affected over the last two years by poorer freight rates and reduced demand for shipping services, particularly in its dry-bulk segment.

Although the Group's performance improved in FY September 2010, its recovery remains slow. Hubline's adjusted funds from operations (FFO) debt coverage ratio of 0.15 times as at end-September 2010 (end-September 2009: 0.14 times) was still weaker than the RAM Ratings' previous expectation.

RAM Ratings head of consumer and industrial ratings Kevin Lim said: 'Looking ahead, the operating environment for the shipping industry remains tough.'

He said improvement in Hubline's cashflow-protection metrics was envisaged to remain lethargic, with its FFO debt coverage ratio coming in at about 0.17 times in FY September 2011, compared to above 0.2 times before the global downturn.

Hubline's ratings remain supported by the Group's extensive network and niche routes that give it a competitive edge over its peers.

By operating smaller vessels, Hubline is able to call at smaller ports where the larger vessels of the main line operators are not able to service.

'Being involved in both the container and dry-bulk shipping segments, the Group is able to enjoy some degree of diversification. Meanwhile, supported by its sizeable cash reserves of RM163.62 million as at end-September 2010, Hubline's liquidity position can be considered satisfactory, RAM Ratings said.

However, the ratings were moderated by Hubline's vulnerability to various industry risks such as cyclicality, capital intensity, intense competition as well as frequent demand and supply imbalances.

'The group is also exposed to volatile bunker costs and high maintenance expenditure. The outlook may be revised to stable if Hubline is able to demonstrate sustainable improvement in its financial profile on the back of improved cargo volumes for its dry-bulk shipping services and its ability to command better freight rates for its niche routes.

'On the other hand, Hubline's ratings could be downgraded if it experiences prolonged deterioration in its financial metrics,' it said.

''

Suria Capital consortium secures RM1b contract for power plant

KUALA LUMPUR: SURIA CAPITAL HOLDINGS BHD [] and its partners have secured a RM1 billion contract to build a 300MW power plant in Kimanis, Sabah.

Suria Capital said on Thursday, Jan 13 its unit SCHB Engineering Services Sdn Bhd and its partners CTCI Corporation, CTCI Overseas Corporation Ltd, CTCI Malaysia Sdn Bhd and Steamline (Malaysia) Sdn Bhd were awarded the contract by Kimanis Power Sdn Bhd.

The CONSTRUCTION [] period will be around three years.

'The contract is expected to contribute positively to the earnings of SCHB Engineering for the financial year ending Dec 31, 2011. The contract does not have any material effect on the net assets per share, share capital and substantial shareholders' shareholding of Suria Capital,' it said.

MMM: RM20m liabilities written off

KUALA LUMPUR: MALAYSIAN MERCHANT MARINE BHD [] said the associated liabilities of about RM20 million have been fully written off.

MMM said on Thursday, Jan 13 that it was informed by BHLB Trustee Bhd that RM8.16 million was remitted to the Employees Provident Fund (EPF) being partial payment of the Islamic debt notes account.

It said the sum was remitted to the EPF on Dec 30 last year and it was notified of the latest development about its RM120.0 million Al'bai Bithaman Ajil Islamic serial bonds facility on Jan 3.

'The board confirms that with this transaction, all of its vessels have been repossessed by EPF and disposed off on account of the debt due to EPF. As such, the company does not possess any more assets and the associated liabilities of approximately RM20 million have been fully written off,' MMM said.

World stocks at new 28-month high, euro firm

LONDON: World stocks climbed to a new 28-month high despite weakness in Europe on Thursday, Jan 13 while the euro held on to the previous session's gains ahead of key debt auctions in Spain and Italy.

Wednesday's smooth sale of Portuguese bonds took the edge off concerns about the ability of debt-strapped euro zone issuers to fund themselves.

But two new tests are looming. Spain is due to issue up to 3 billion euros of five-year bonds on Thursday, with Italy set to offer 7 billion euros of 5- and 15-year government bonds.

Both auctions were expected to be relatively successful and markets were generally calm ahead of a European Union finance ministers meeting next week that is likely to address new support mechanisms.

Promises from China and Japan to support Europe through its fiscal crisis have also helped ease worries about the euro zone's financing troubles.

One result has been a rebound in the euro from recent lows. It hit a one-month high against the Swiss franc on Thursday, for example, and was above $1.31, compared with recent trading below $1.29.

"We're wary of positioning for euro downside too aggressively because there seems to be more and more news that Germany and France are going to push through some emergency resolution package," said Geoffrey Yu, currency strategist at UBS.

"So the euro could rally going into this."

The European Central Bank meets later in the day but is expected to keep interest rates unchanged at 1.0 percent, leaving the focus on the ECB's bond-buying programme and an acceleration in euro zone inflation.

''

BUOYANT STOCKS

Outside Europe, stocks were generally high, lifted by perceptions of an improving global economy and positive corporate earnings.

Intel Corp is to report quarterly results later.

World stocks as measured by MSCI were up a quarter of a percent at a fresh 28-month high and emerging market stocks climbed to a 31-month peak.

This came despite losses in Europe, where the FTSEurofirst 300 lost 0.4 percent in what was likely to be profit-taking after a run that has given it a more than 3.3 percent gain this year.

"The strong bond auction in Portugal has calmed the markets ... with no major negative factors in sight," said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management in Japan.

The Nikkei closed up 0.7 percent, at a new eight-month high. - Reuters

Tesco misses forecasts, non-food retailers suffer

LONDON: Tesco, the world's third-biggest retailer, missed Christmas sales forecasts as another string of British store groups said winter weather hit purchases of non-food goods.

The 0.6 percent rise in Tesco's underlying British sales was better than falls reported on Thursday, Jan 13 by electricals specialist Dixons, general merchandise group Home Retail, computer games seller Game Group, bicycles chain Halfords and fashion group New Look.

However, it fell short of rises reported this week by supermarket rivals J Sainsbury and Wm Morrison.

"Disappointing," said Shore Capital analyst Clive Black. "Over the 2010/11 festive period Tesco UK has underperformed its peers," he said, trimming his full-year profit forecast 30 million pounds ($47 million) to 3.42 billion.

At 0900 GMT, Tesco shares were down 2.1 percent at 414.8 pence, the biggest decliner in the blue-chip FTSE 100.

Finance director Laurie McIlwee said Tesco suffered because it was reporting over a shorter trading period than Sainsbury and also from having more out-of-town stores, which were more disrupted by bad weather, than rivals.

A strong performance a year ago and pressure on consumers from higher taxes and petrol prices did not help.

"It is a combination of lapping last year, tough budgets, very severe weather and incredible petrol inflation," McIlwee told reporters.

Tesco, world number three behind U.S. leader Wal-Mart and French group Carrefour, said group sales rose 6.2 percent excluding fuel and at constant currencies in the six weeks to Jan. 8, with overseas sales adding to modest growth at home.

That pattern was likely to be mirrored when Carrefour publishes fourth-quarter sales after markets close on Thursday, as European shoppers worry about austerity measures.

''

BRITISH BLUES

In Britain, where Tesco accounts for about one pound in every seven spent at retailers, grocers had a better Christmas than most specialist chains as a trend towards one-stop shopping was exacerbated by bouts of heavy snow.

Tesco, which makes about two thirds of its sales and profit in Britain, said Christmas sales at British stores open at least a year rose 0.6 percent excluding fuel but including VAT sales tax.

That was a slowdown from a 1.5 percent rise in its fiscal third quarter and below a forecast increase of about 1.7 percent in a Reuters poll.

It was also below the 3.6 percent rise posted by J Sainsbury on Wednesday.

"A global giant like Tesco should not be judged on its UK like-for-like sales, but it will be and a LFL sales rise of only 0.6 percent is dull," Arden Partners analyst Nick Bubb said.

McIlwee said bad weather probably reduced underlying British sales by about 1 percent, and that while underlying food sales rose 1.7 percent, non-food sales fell 1.5 percent. That compared with a 7 percent rise in non-food sales during Christmas 2009.

Tesco gets about a quarter of British sales from non-food ranges, compared with about 15 percent for Sainsbury's.

McIlwee said electricals sales suffered because the group did not have enough hot-selling Apple products, while sales in toys and gaming were better. Excluding VAT, Tesco's underlying British sales fell 0.4 percent.

The group, with over 5,000 stores in 14 countries, said overseas sales rose 10.1 percent excluding petrol and at constant currencies, led by strong growth in China and Thailand.

Dixons, which runs the PC World and Currys chains, and car parts to bicycles retailer Halfords, both said full-year profit would be at the lower end of analysts expectations after falls in underlying British sales.

Dixons shares were down 6.2 percent.

The Co-Operative Group, Britain's biggest mutual retailer, reported a 3.2 percent fall in fourth-quarter underlying sales at food shops, while fashion group New Look said underlying sales plunged 9.1 percent.

Home Retail, however, posted a smaller-than-expected decline in underlying sales at its Argos stores and Homebase home improvement chain and said its profit forecast was unchanged, sending its shares up 8 percent.

Game Group shares also rose, up 16 percent, after it reported a smaller than expected fall in underlying British sales and said they were likely to start rising again soon.

Genting, Sime lift KLCI, ringgit at 13-yr high

KUALA LUMPUR: Shares of Genting and Sime Darby drove the FBM KLCI higher close on Thursday, Jan 13 on foreign fund buying, in line with the positive key regional markets while the ringgit surged to a 13-year high.

The FBM KLCI rose 5.07 points or 0.32% to 1,571.56. Turnover was 2.7 billion shares valued at RM3 billion. The broader market was firm with 528 gainers to 340 losers while 306 stocks were unchanged.

Among the key regional markets, the Nikkei 225 rose 0.73% to 10,589.76, Hang Seng Index added 0.47% to 24,238.98, Shanghai Composite Index 0.23% to 2,827.71 and Singapore's Straits Times Index 0.18% to 3,250.94.

The ringgit rose to 3.05345 to the US dollar, up 0.0105 from the previous day's close. A strong ringgit was expected to draw foreign funds into the equities market. Light crude oil slipped five cents to US$91.81 while crude palm oil futures added RM9 to RM3,622.

Malaysia's economic growth was still in place, though it would expand at a slower pace when compared to 2010, according to economists.

HSBC Asian economist Wellian Wiranto expects Malaysia's economy to grow at a slower pace of 5.1% in 2011 after seeing a strong projected recovery of 7.1% in 2010.

This slower growth is due to the 2010's lower base but exports and employment outlook for Malaysia would continue to be strong, he said.

At Bursa, GENTING BHD [] rose 14 sen to RM11.98, pushing the 30-stock FBM KLCI up 1.22 points while Genting Malaysia added six sen to RM3.65. Sime Darby rose five sen to RM9.35.

BAT was the top gainer, surging RM1.30 to RM48.48, adding 0.58 of a point to the index while JTI added 35 sen to RM6.60.

Mudajaya added 31 sen to RM5.20, Boustead 28 sen to RM5.91, Petronas Dagangan 24 sen to RM12.28 and Bursa 22 sen to RM8.97. AirAsia rallied 18 sen to RM3.04 while Tan Chiong advanced 17 sen to RM5.15.

Among property counters with exposure to Iskandar Malaysia, SP Setia added 24 sen to RM6.93 while Tebrau Teguh rose 12 sen to 94.5 sen.

However, Faber slumped 44 sen to Rm2.19, the lowest since May last year after its two contracts in Abu Dhabi were not renewed.

Masterskill extended its losses, down 19 sen to RM2.15 after the company reported that foreign fund FMR LLC sold 3.75 million shares on Jan 6-7 and reduced its stake to 29.74 million shares or 7.26%.

Maybank launches ringgit-based mortgage facility for UK property

KUALA LUMPUR: MALAYAN BANKING BHD [] expects a take-up of RM60 million within the next six months for the ringgit mortgage facility offered to Malaysians who want to purchase property in London.

The bank's 'Overseas Mortgage Loan Scheme', launched on Thursday, Jan 13, will finance completed or residential and commercial PROPERTIES [] under CONSTRUCTION [] in London Zone 1 to Zone 3 in prime locations such as City of London, Westminster, Knightsbridge, Kensington and Chelsea.

'Key features of Overseas Mortgage Loan Scheme include repayment in ringgit, high margin of financing up to 85%, flexible repayment and long tenure of up to 30 years or 70 years of age whichever is earlier,' it said.

Maybank's deputy president and head of community financial services, Lim Hong Tat said Malaysians would be able to borrow in ringgit for purchase of property in London with the loan taken in Malaysia.

'Borrowing in ringgit will protect customers from currency fluctuations on their monthly loan repayments and savings as the sterling pound is anticipated to rise this year from its current low exchange rate with the ringgit,' he said.

At present, Malaysians purchasing properties in London have to obtain financing from UK based banks and pay the monthly installments in sterling pound and they are exposed to foreign currency exchange fluctuations.

Lim said financing from UK based banks for Malaysian citizens currently was only available for 'buy-to-let purposes', namely, the property must be purchased for investment purposed and not for own occupation.

As for Maybank's ringgit-based mortgage facility, he said it would be offered in the form of term loan, overdraft or a combination of term loan and overdraft.

'We anticipate a take up of RM60 million for this new facility within the next six months. This is in view of attractive property valuation in London and overseas buying interest to peak before April 2011 when the new 5% sales tax is imposed for properties above ''1 million.

'The current strong ringgit against the sterling pound is also another factor that will encourage Malaysians to buy before the anticipated rise at the second half of the year,' Lim said.

Lim said the new mortgage was designed for high net worth customers who were showing increasing interest in buying properties in that part of Europe, due to the favourable currency exchange rate, attractive property price as well as for those who have children studying in the London area.

'London currently offers attractive advantages for property purchase to non residents and the Bank has tied-up with reputable international real estate agencies to assist customers on UK regulations,' Lim said.

Tan Chong Motor sees 4.75m shares done off-mkt at RM5.35 each

KUALA LUMPUR: TAN CHONG MOTOR HOLDINGS BHD [] saw 4.75 million shares transacted in several off-market deals at an average price of RM5.35 apiece.

Stock market data showed on Thursday, Jan 13 that the off-market transaction was 37 sen above the previous day's closing price of RM4.98.

As at 3.55pm, the share price was up 11 sen to RM5.09. There were 311,300 shares transacted at prices ranging from RM4.98 to RM5.15.

Tebrau Teguh up 10.3%, rising interest in Johor property stocks

KUALA LUMPUR: Shares of TEBRAU TEGUH BHD [] rose 10.3% to 91 sen in late afternoon on Thursday, Jan 13 as trading interest focuses on companies with exposure to the property sector in Johor, especially the Iskandar Malaysia.

At 3.04pm, Tebrau Tegu was up 8.5 sen to 91 sen. There were 46.60 million shares transacted.

The FBM KLCI rose 3.14 points to 1,569.63. Turnover was 1.9 billion shares valued at RM1.83 billion.'' There were are 467 gainers, 345 losers and 302 stocks unchanged.

RHB Research said it believed property stocks which have high exposure to the Johor region, and high beta (more than 1.8) such as UEM Land, Tebrau Teguh and Mulpha International, are likely to attract trading interest.

'Maintain Overweight on the sector,' it said on Thursday, Jan 13. Its top picks are SP Setia (OP, FV = RM6.95), and IJM Land (OP, FV = RM3.50) for big caps; and KSL (OP, FV = RM2.78) and Mah Sing (OP, FV = RM2.50) for small-mid caps. For Johor exposure, its fundamental pick is KSL.

Construction, tobacco stocks top gainers list

KUALA LUMPUR: Selected CONSTRUCTION [] and tobacco stocks led the gainers list at the midday break on Thursday, Jan 13 while the broader market sentiment was firmer in line with the key regional markets on expectations the Europe debt crisis could be restrained.

At 12.30pm, the FBM KLCI was up 3.18 points to 1,569.67. Turnover was 1.63 billion shares valued at RM1.53 billion. There were 450 gainers, 327 losers and 304 stocks unchanged.

Among key regional markets, Japan's Nikkei 225 rose 0.65% to 10,581.32, Hang Seng Index added 0.5% to 24,247.22, Shanghai Composite Index unchanged at 2,821.48 and Singapore's Straits Times Index 0.2% higher at 3,251.40.

The ringgit was firmer against the US dollar at 3.0555 compared with the previous close of 3.0650. Crude palm oil futures rose RM45 to RM3,658 while light crude oil fell four cents to US$91.82.

At Bursa, tobacco stocks BAT added 62 sen to RM47.80 and JTI 31 sen to RM6.56. Construction-property stocks like Mudajaya added 21 sen to RM5.10, SunCity 15 sen to RM4.70 and IJM 14 sen to RM6.60.

Hap Seng Consolidated snapped its three-day losses to rebound 14 sen to RM6.30 as investors viewed the selldown as overdone following the nearly RM1.5 billion placement and rights issue plan.

Karambunai was the most active with 96.13 million shares done, adding 2.5 sen to 23.5 sen.

Among the index linked stocks, Axiata and Sime added five sen each to RM4.92 and RM9.35, TM four sen to RM3.70 while among banks, Hong Leong Bank rose 10 sen to RM9.50, AMMB added eight sen to RM7.02 and Public Bank two to RM13.48.

Faber fell the most, down 30 sen to RM2.33 after its two contracts in Abu Dhabi were not renewed.

Masterskill lost 14 sen to RM2.20 after FMR LLC and FIL Ltd sold more shares.

The funds disposed of 2.42 million shares on Jan 6 and 1.33 million shares the next day, reducing its shareholding to 29.74 million shares or 7.26%.

Among oil and gas players, Sapuracrest fell 20 sen to RM3.58 on profit taking while Uzma and Kencana shed nine sen each to RM2 and RM2.77.