Bursa Malaysia Market News

Lion Corp gets Bursa nod to list 950m new shares

2012-01-05T21:33:00.007+08:00

KUALA LUMPUR (Jan 5): LION CORPORATION BHD [] has received Bursa Malaysia Securities Bhd's approval to list up to 950 million new shares to settle the overdue amount owed by its 79% subsidiary Megasteel Sdn Bhd.

The company said on Thursday Bursa Securities had also approved the proposed share consolidation.

However, the approvals were subject to conditions, wherein Lion Corp must fully comply with the relevant provisions under the Main Market Listing Requirements of Bursa Securities.

To recap, the 950 million new shares was to settle the RM950 million due by Megasteel to the unsecured trade creditors with an overdue amount of RM500,000 and above as at April 30, 2011.

This settlement would involve the issuance of one new share at par value of RM1 Lion Corp share and deferred cash payment of 20 sen for every RM1 of the overdue amount.

Lion Corp had said the proposed capital reCONSTRUCTION [] involved the proposed reduction of the par value of the existing LionCorp shares of RM1 each to 20 sen each by cancelling 80 sen.

This would be followed by the proposed consolidation of every five Lion Corp shares of 20 sen each into one share of RM1 each after the capital reduction was completed.

Can-One says unaware of unusual market activity

2012-01-05T21:33:00.005+08:00

KUALA LUMPUR (Jan 5): CAN-ONE BHD [], whose share price surged on Thursday, told Bursa Malaysia Securities it was unaware of the reasons for the unusual market activity (UMA).

Can-One surged 31 sen to close at RM1.37 with 6.95 million shares done.

In its reply to Bursa Securities' query, it said there was no corporate development relating to the group's business and affairs that had not been previously''announced that may account for the UMA.

'We are not aware of any rumour or report concerning the business and affairs of Can-One group that may account for the UMA,' it said.

DBS says probing unauthorised withdrawals in Malaysia

2012-01-05T21:33:00.003+08:00

SINGAPORE (Jan 5): DBS Group Holdings said on Thursday it is investigating complaints from customers of unauthorised withdrawal of funds in Malaysia, through the use of the bank's debit and automated teller machine (ATM) cards.

The bank said it immediately de-activated the compromised cards and is taking steps to compensate these customers in full.

It did not disclose the number of customers affected or the amount of funds withdrawn.

'We are treating the matter with utmost priority and would like to assure customers that they will be fully compensated, for any unauthorised withdrawals, within 24 hours,' Jeremy Soo, head of consumer banking group Singapore, DBS Bank, said in a statement.

'Investigations are currently underway and we are presently validating all ATM/Debit card transactions made in Malaysia over the past few days,' he said. - Reuters

Khaznah, Temasek in talks with bank to finance Singapore projects

2012-01-05T21:33:00.001+08:00

PUTRAJAYA (Jan 5): Khazanah Nasional Bhd (Khazanah) and Temasek Holdings (Pte) Ltd (Temasek) are currently in the midst of discussions with
banks to provide financing for M+S Pte Ltd development projects in Singapore.

M+S, a company owned 60:40 by Khazanah and Temasek respectively, is set to develop land parcels in Marina South and Ophir-Rochor with an estimated gross development value of RM27 billion (S$11 billion).

The developments in these areas are expected to be completed over the next six years, with CONSTRUCTION [] expected to commence in 2013, according to a joint statement released by Khazanah and Temasek after the bilateral meeting between Prime Minister Datuk Seri Najib Tun Razak and his Singapore counterpart Lee Hsien Loong here on Thursday.

It added that M+S has appointed architects and consultants for the Marina South and Ophir-Rochor developments and submitted the designs for provisional planning approvals in the last quarter of last year.

Meanwhile, Pulau Indah Ventures Sdn Bhd (Pulau Indah), a 50:50 joint venture between Khazanah and Temasek, will develop the 'Urban Wellness' project on a 2.02 ha site in Medini North.

It will also develop the 85.5 ha 'Resort Wellness' project in Medini Central.

The gross development value of the projects, which include the development of a wellness centre, serviced residences, a corporate training centre,
commercial, retail and residential and wellness-related offerings, is estimated at approximately RM3.0 billion.

For the Urban Wellness project, Pulau Indah has appointed CapitalLand as project manager via the exchange of the Project Management Agreement.

The project is expected to commence in 2013 and completed over the next four years.

For the Resort Wellness project, Pulau Indah and an indirect wholly-owned subsidiary of Eastern and Oriental Berhad (E&O), had exchanged the Shareholders' Agreement in relation to Nuri Merdu Sdn Bhd, the 50:50 joint venture vehicle for the Resort Wellness project.

E&O will also carry out the project management and marketing for the Resort Wellness site.

The architect, master planner and key consultants havwe been selected for the project, with the initial phase expected to commence in 2013 and the whole project to be completed in five years.

Earlier, Najib and Lee were briefed on the concept for both the Urban Wellness and Resort Wellness developments. - Bernama

KLCI snaps losing streak, closes 0.68% higher

2012-01-05T19:32:00.007+08:00

KUALA LUMPUR (Jan 5): The FBM KLCI snapped its losing streak on the third trading day of 2012 and closed in the positive territory for the first time in the New Year, lifted by gains at banking and select blue chip stocks.

The FBM KLCI gained 10.21 points to close at 1,514.43.

Gainers beat losers by 467 to 325, while 324 counters traded unchanged. Volume was 1.67 billion shares valued at RM1.46 billion.

However, whether the index would be able to sustain its gains on Friday remains uncertain as most Asian markets closed in the negative territory while European indices fell in early trade on Thursday.

At the regional markets, Hong Kong's Hang Seng Index added 0.46% to 18,813.41, Taiwan's Taiex gained 0.68% to 7,130.86 and Singapore's Straits Times Index edged up 0.07% to 2,713.02.

Meanwhile, the Shanghai Composite Index fell 0.97% to 2,148.45, Japan's Nikkei lost 0.83% to 8,488.71 while South Korea's Kospi shed 0.13% to 1,863.74.

Concern about the appetite for euro zone sovereign debt pushed European stocks lower and hit the single currency on Thursday, with the first French bond auction of 2012 set to test how much progress policymakers have made in easing tensions, according to Reuters.

The price France has to pay to sell 7 to 8 billion euros of longer-term bonds will measure how much relief markets have taken from the EU leaders' December plan for resolving the crisis and the near half-trillion euros pumped into the region's banks by the European Central Bank, it said.

On Bursa Malaysia, KLK jumped RM1.76 to RM25.26, Dutch Lady gained RM1 to RM24, Can-One 31 sen to RM1.37, Nestle 30 sen to RM56.30, Timwell 28 sen to RM1.08, BHIC and Boxpak 26 sen to RM4.11 and RM2.52, Carlsberg and MISC 23 sen each to RM8.71 and RM5.96, while BLD PLANTATION []s was up 22 sen to RM7.60.

Among banking stocks, CIMB rose six sen to RM7.16, RHB Capital five sen to RM7.33, Affin seven sen to RM3.09, HLFG four sen to RM11.56, while Maybank and Public Bank gained two sen each to RM8.29 and RM13.16.

Decliners were led by RIC that lost 35 sen to RM1.45, BAT 14 sen to RM49.66, IGB 10 sen to RM2.48, Genting Plantations and IJM Corp eight sen each to RM8.60 and RM5.46, Malayan Flour Mills and WCT seven sen each to RM7.16 and RM2.18, while Mahajaya and AFG fell six sen each to 62 sen and RM3.89.

The actives included XDL, JCY, Proton, Versatile and Astral Supreme.

SapuraCrest unit inks contracts worth RM712.78 million

2012-01-05T19:32:00.005+08:00

KUALA LUMPUR (Jan 5): SAPURACREST PETROLEUM BHD [] has secured two contracts worth combined US$227 million (RM712.78 million) to build two units pipelay cum heavylift offshore CONSTRUCTION [] vessels.

It said on Thursday that its unit TL Offshore Sdn Bhd had finalised the contracts with Cosco (Nantong) Shipyard Co. Ltd.

SapuraCrest said both parties had agreed that the contract be effective from Sept 10, 2011.

It said one of the Vessels was scheduled to be delivered in the fourth quarter of 2013, whilst the other vessel to be delivered in the first quarter of 2014.

Maxbiz: RM510m LOI based on RM5,100 per connection to 100,000 homes, office

2012-01-05T19:32:00.003+08:00

KUALA LUMPUR (Jan 5): MAXBIZ CORPORATION BHD [] says the contract value of the letter of intent (LOI) of RM510 million from Fibre-N Sdn Bhd was based on the infrastructure works of RM5,100 per connection.

Maxbiz said on Thursday the LOI was for the fibre-to-the-home and fibre-to-the-office (FTTX) infrastructure works for 100,000 connections to high- rise residential and office buildings in Klang Valley, Penang and Johor Bahru.

'By way of comparison, TELEKOM MALAYSIA BHD []'s cost for the High Speed Broad Band (HSBB) project of a similar nature was stated as RM11.3 billion for 1.3 million connections, spanning over 10 years,' it said.

In its reply to a query from Bursa Malaysia Securities'' that Fibre-N had undertaken to deploy one million homes specifically in multi-tenanted buildings (high rise condominium and office buildings) over three to five years.

Fibre-N is a fibre optic cabling turnkey contractor for both in-building cabling works and roadside cable laying works. It is a wholly owned subsidiary of Open Fibre Sdn Bhd and the directors are Ranjeet Singh Sidhu and Hasniza Hashim.

Maxbiz said the overall cost of the project based on Fibre-N's current rate of RM5,100 per connection was RM510 million.

However, this included both out-plant works and in-plant works and also related scope of works such as project management, site survey works, testing & commissioning.

Kian Joo MD See Teow Chian retires

2012-01-05T19:32:00.001+08:00

KUALA LUMPUR (Jan 5): KIAN JOO CAN FACTORY BHD []'s managing director Datuk See Teow Chuan has retired with effect from Thursday.

The company said that See, 71, ceased to be the managing director after his contract of service expired on Thursday.

However, he would remain on the board of directors as a non-independent and non-executive director.

See has a 45-year track record in the can and also carton manufacturing business. He also sits on the boards of several private limited companies.

He has a direct stake of 14.523 million Kian Joo shares.

Menang Corp sees 4.49% stake crossed at 22c each

2012-01-05T17:32:00.005+08:00

KUALA LUMPUR (Jan 5): Property-based Menang Corporation Bhd saw 12 million shares crossed in several off-market deals on Thursday afternoon.

Stock market data showed the shares, representing a 4.49% stake, were crossed at an average price of 22 sen.

At 3.39pm, Menang was up one sen to 23 sen.

On Dec 27, Menang group deputy chairman Datin Mariam Eusoff increased her shareholding in the company with the recent acquisition of 20 million shares, or a 7.48% stake.

She bought the shares from the open market at 20 sen each on Dec 27. The recent acquisition saw her shareholding increase to 26.18% or 69.949 million shares.

MAS extends gains on fresh newsflow, turnaround hopes

2012-01-05T17:32:00.003+08:00

KUALA LUMPUR (Jan 5): Shares of Malaysian Airline System (MAS) rose in active trade on Thursday on fresh corporate newsflow and expectations of a turnaround in its fortunes following a top management revamp.

At 4.09pm, MAS was up 17 sen to RM1.58 with 17.82 million shares done. Its call warrants MAS-CD added 4.5 sen to 16 sen while MAS-CE gained five sen to 18.5 sen.

The FBM KLCI rose 7.75 points to 1,511.97. Turnover was 1.39 billion shares valued at RM1.10 billion. There were 384 gainers, 358 loser and 326 counters unchanged.

The latest newsflow was the the Securities Commission's approval for the proposed warrants exchange exercise between MAS and AIRASIA BHD []. However, the approval is subject to the company complying with the relevant requirements pertaining to the implementation of the proposal as stipulated under the SC's equity guidelines.

Meanwhile, a news report said MAS' short-haul premium airline is set to be launched by the first half of this year. This airline would be using six B737-800 aircraft, previously used by Firefly.

Last Friday, MAS unveiled a management structure with new business units, group chief executive officer Ahmad Jauhari taking on the role as CEO of long-haul, the departure of several top officials and the entry of two aviation experts.

Bursa Securities queries Can-One over price surge

2012-01-05T17:32:00.001+08:00

KUALA LUMPUR (Jan 5): Bursa Malaysia Securities Bhd has queried CAN-ONE BHD [] over the sharp increase''in the price of the shares recently.

At 4.41pm, Can-One was up 31 sen to RM1.37 with 6.95 million shares done.

Proton advances on chairman bid, but strategic partner crucial

2012-01-05T16:31:00.003+08:00

KUALA LUMPUR (Jan 5): Securities of PROTON HOLDINGS BHD [] rose on Thursday, spurred by the latest corporate development where its chairman Datuk Mohd Nadzmi Mohd Salleh confirmed he had put in a bid for Khazanah Nasional's 42.7% stake.

However, CIMB Research said a strategic partnership with a global original equipment manufacturer (OEM) involving TECHNOLOGY [] transfer was needed for Proton's exports aspirations and its long-term sustainability as an auto manufacturer.

At 2.31pm, Proton was up 13 sen to RM15.01 while its call warrants also advanced in heavy trade. Proton-CL rose seven sen to 22 sen, Proton-CG five sen to 49.5 sen and Proton-CH 4.5 sen to 45 sen.

The FBM KLCI rose 2.88 points to 1,507.10. Turnover was 771.48 million shares done valued at RM599.23 million. There were 308 gainers, 311 losers and 339 counters unchanged.

A news report quoted Nadzmi as saying that privatisation was the way to go for Proton, which would enable him to restructure the whole group to turn it around.

"I know the business well, and Proton is close to my heart. There is a potential in Proton and that is why I dare to make a bid and the offer runs into billions," he was quoted saying in the report.

Nadzmi had also said if "done right", Proton's profit could easily be doubled or tripled without incurring any additional investment cost.

"It is all about how you juggle your assets. This could be done by increasing the utilisation rate of Proton's assets, cost reduction and also increasing Proton's exports. These steps could easily add a further RM500 million to RM600 million to Proton's bottom line," he was quoted saying.

CIMB Research said news of a potential management buyout is not entirely a surprise as Proton's management has, in the past, indicated such intention to do so.

'Datuk Nadzmi's belief in the privatisation for Proton and his indication that his bid runs into billions should be good news for minority shareholders banking on Proton's general offer,' it said.

The research house said'' his comment on an offer for the NTA price of Proton being too high reaffirmed its belief that a balance has to be struck as Khazanah would unlikely to settle for a price much lower than Proton's NTA but an entry price that is too high would give the acquirer less ammunition in its overhaul of the company.

'While we concur that one way to revive Proton's profitability would be to increase its plants' utilisation rate needed for the business to achieve economies of scale, we think a strategic partnership with a global OEM involving technology transfer is needed for Proton's exports aspirations and its long-term sustainability as an auto manufacturer,' it said.

Navis Cap keen to buy Hong Peng's stake in Xidelang

2012-01-05T16:31:00.001+08:00

KUALA LUMPUR (Jan 5): XiDeLang Holdings Ltd'' (XDL) says Navis Capital has approached the former's major shareholder Hong Peng International Holdings Ltd to acquire its stake.

It said on Thursday that 'Navis Capital had indicated their intention to acquire the entire shareholdings of Hong Peng in XDL during an informal discussion'.

Trading in the shares of XDL was voluntarily suspended from 2.30pm to 3.30pm following the announcement.

According to filings to Bursa Malaysia, the British Virgin Islands' registered Hong Peng owns 240 million XDL shares or 60% as at Nov 11, 2009.

XDL share price was up one sen to 37.5 sen before trading was suspended.

KWAP to expand real estate portfolio, eyes Australia, UK

2012-01-05T14:31:00.009+08:00

KUALA LUMPUR (Jan 5): Kumpulan Wang Persaraan (KWAP), which recently completed its acquisition of the 14-storey ASX Building in Sydney, Australia for AU$185 million, will remain active in the global real estate market, said its chief executive officer, Datuk Azian Mohd Noh.

"In 2012, we will continue to remain active in the global real estate market and grow KWAP's real estate portfolio. Besides Australia, UK is another major
property investment destination for KWAP.

"KWAP has allocated four per cent of its entire fund size or approximately RM3.2 billion for both local and international property investments and this is
KWAP's second acquisition in Australia," she said in a statement.

Elaborating on the ASX Building, Azian said it was a Grade A freehold office building located at the corner of Bridge Street and Pitt Street, Sydney's prime
financial district.

The acquisition is part of KWAP's international property investment venture, she said, adding that the property, with a net lettable area of 213,089 sq ft
was currently 85 per cent occupied.

The building's major tenant, ASX Operations Pty Ltd, part of the ASX Group which operates the Australian Securities Exchange, occupies approximately 57 per cent of the property space and the ground floor retail space is currently occupied by HSBC Bank Australia Ltd.

KWAP appointed CB Richard Ellis to undertake the property management of the asset.

This is KWAP's second property investment in Australia after acquiring 737 Bourke Street office building in Melbourne in December 2010 for AU$113.0
million. - Bernama

KLCI remains in positive territory at mid-day, but gains seen capped

2012-01-05T14:31:00.007+08:00

KUALA LUMPUR (Jan 5): The FBM KLCI stayed above the psychologically-crucial 1,500 level at the mid-day break on Thursday, but pared down its gains as investor sentiment remains fragile.

At 12.30pm, the FBM KLCI was up 2.59 points to 1,506.81. Gainers edged losers by 306 to 300, while 334 counters traded unchanged. Volume was 754.24 million shares valued at RM579.57 million.

The ringgit weakened 0.11% to 3.1392 versus the US dollar; crude palm oil futures for the third month delivery fell RM2 per tonne to RM3,213, crude oil shed 23 cents per barrel to US$102.99 while gold gained US$4.97 to US$1,616.57.

Asian stocks steadied and reversed some earlier losses, but overall sentiment was cautious given concerns about the ability of euro zone countries to refinance their huge public debt that dampened investor risk appetite.

Meanwhile, China's services sector entered a seventh straight year of expansion in December, a survey of purchasing managers showed on Thursday, but a slowdown in the world's second-biggest economy saw overall levels of activity mired at three-month lows, according to Reuters.

The HSBC China services purchasing managers index (PMI) stood at 52.5 in December, unchanged from November, signalling a steady if sluggish expansion in the sector that is increasingly a barometer for domestic economic conditions, it said.

At the regional markets, Hong Kong's Hang Seng Index was up 0.44% to 18,810.38, Singapore's Straits Times Index added 0.58% to 2,726.76, South Korea's Kospi gained 0.39% to 1,873.49, Taiwan's Taiex was up 0.37% to 7,109.30 and the Shanghai Composite Index edged up 0.32% to 2,176.37.

Meanwhile, Japan's Nikkei 225 fell 0.65% to 8,504.44.

On Bursa Malaysia, Dutch Lady gained 60 sen to RM24.60; Timwell was up 28 sen to RM1.08, Can-One 24 sen to RM1.30, Sarawak PLANTATION []s and BHIC 22 sen each to RM2.59 and RM4.07, SOP 15 sen to RM6, while Perduren, Tahps, HLFG and Proton added 12 sen each to 85 sen, RM4.40, RM11.64 and RM5 respectively.

Decliners included Far East, YHS, Malayan Flour Mills, UMS, IJM Corp, Sime Darby, Genting and IGB, while the actives included JCY, Versatile, Proton, HWGB and Astral Supreme.

#Flash* Genting Malaysia considering US$4 bln complex in Queens, NY

2012-01-05T14:31:00.005+08:00

KUALA LUMPUR (Jan 5): Genting Malaysia Bhd's unit is considering developing an integrated mixed-use complex, costing US$4 billion, on real property located adjacent to the Aqueduct Racetrack, Queens, New York.

It said on Thursday its indirect unit Genting New York LLC (Genting NY) had signed a non-binding letter of intent dated Jan 3, 2012 with the New York State Urban Development Corporation for the project.

'The proposed project is anticipated to cost at least US$4 billion, which will include an integrated 3.8 million square feet of convention and exhibition centre with up to 3,000 hotel rooms and an expansion of Resorts World Casino New York City,' it said in a statement to Bursa Malaysia.

Genting NY said it will work closely with New York State Urban Development Corporation, which undertaking the business as Empire State Development Corporation, and the relevant parties, to negotiate the terms.

The plan is to enter a binding memorandum of understanding on or before Nov 30, 2012.

Eversendai bids for RM12b projects worldwide

2012-01-05T14:31:00.003+08:00

KUALA LUMPUR, Jan 5 (Bernama) -- Eversendai Corporation Bhd is bidding for RM12 billion worth of infrastructure development projects worldwide, says executive chairman cum group managing director Datuk A.K. Nathan.

He said the projects would consist of iconic infrastructure development,power plants, engineering jobs and other segments related to Eversendai's core businesses.

"The projects will be situated mainly in the Middle East, South East Asia and Commonwealth of Independent States (CIS) region," he told reporters after the signing of a memorandum of understanding between Eversendai and Sunway Business Applications here on Thursday.

He said the bidding process was on-going and Eversendai was optimistic of securing at least 20 per cent of the projects aimed given the track record of the company.

"Our success rate is usually 20 per cent and this time around we think it will be a similar figure. If it's more, I would be happy," he said.

Nathan said the company's orderbook currently stood at RM1.5 billion and he anticipated a minimum growth of 10 per cent this year.

"Every year, we have seen 10 per cent growth. Ninety-five per cent of our earnings accrue from Eversendai's overseas operations while the Malaysian
operations contributed the remaining five per cent.

"However, this year onwards we will be very busy in Malaysia. We have just completed the Manjung power plant and have kickstarted the KLIA 2 project and a project in Sabah. We expect many more to come as we have bid for many more projects here (in Malaysia).

"The projects are part of the RM12 billion projects we have already bid for. But, nothing is finalised until the contract is awarded," he said.

Nathan said in future, the Malaysian operations were poised to contribute at least 10 per cent of the company's earnings compared with the current
contribution of five per cent.

He added that Malaysia and India would become Eversendai's fastest growing markets in coming years.

"In India, we have five ongoing projects which comprises of two high-rise buildings and three power projects. "One of the projects is the RM350 million Worli Tower, which comprises a 50-storey and 80-storey buildings," he said.

Nathan said the company was also in the midst of constructing a steel fabrication plant in Trichy, India, which would boost the company's steel output
by 24,000 tonnes per annum.

"This will add to our total capacity of some 144,000 tonnes, annually," he said.

The factory, slated to be operational between six and eight months, will add to the list of four steel fabrication plants currently operating each in
Rawang, Sharjah, Qatar and Dubai. - Bernama

JAL eyes IPO of as much as US$13 bln

2012-01-05T14:31:00.001+08:00

TOKYO (Jan 5): Japan Airlines Co plans to list its shares in an initial public offering that could raise as much as 1 trillion yen ($13 billion), Bloomberg reported on Thursday, citing two people familiar with the matter.

A JAL spokesman declined to comment. A government-backed turnaround body hired Nomura Holdings Inc and Daiwa Securities Group Inc in July as advisers on plans to re-list shares in the carrier, which filed for bankruptcy protection in January 2010.

The IPO could take place as early as September, Bloomberg said. - Reuters

Frost & Sullivan sees auto industry volume just up 1.2% to 612,000 in 2012

2012-01-05T13:31:00.001+08:00

KUALA LUMPUR : Research firm Frost & Sullivan expects the Malaysian automotive total industry volume (TIV) to reach 612,000 units in 2012. This is a yearly growth of 1.2% from the expected figure of 605,000 units in 2011.

Frost & Sullivan head of automotive and transportation practice Kavan Mukhtyar said its 2012 forecast comes amid an uncertain global economic outlook, limited new mass market model launches and concerns of lower loan approval rates for buyers.

"Banks will be more cautious," he said at a media conference on Thursday.

He said Malaysian TIV could still see annual growth of some 5% for the next 10 years. This compares to a 15 to 20% growth rate seen in the past.

HSBC China services PMI steady, economy subdued

2012-01-05T12:00:00.001+08:00

BEIJING (Jan 5): China's services sector entered a seventh straight year of expansion in December, a survey of purchasing managers showed on Thursday, but a slowdown in the world's second-biggest economy saw overall levels of activity mired at three-month lows.

The HSBC China services purchasing managers index (PMI) stood at 52.5 in December, unchanged from November, signalling a steady if sluggish expansion in the sector that is increasingly a barometer for domestic economic conditions.

"Unmoved on November's three-month low, the service sector PMI pointed to subdued growth momentum," Qu Hongbin, chief economist for China and co-head of Asian economic research at HSBC said in a statement accompanying the index.

That said it was the 74th straight month that the index had read above 50 -- the level that demarcates expansion from contraction -- and a level it has been above every month since the survey started in November 2005.

The steady state of the HSBC index, compiled by UK-based data provider Markit, will reinforce the views of some investors that China's economic slowdown will be modest and short-lived.

A solid rebound in the official services PMI earlier this week followed on from a gentle bounce in manufacturing activity in both official and private sector surveys.

But the sensitivity of investors to any uptick in headline economic news is arguably a function of how skewed their portfolios are towards anticipating further deterioration.

"The market is very vulnerable right now to good news," Michael Kurtz, chief Asia equity strategist at Nomura, said.

Kurtz says an anticipated softening of economic data has left regional hedge fund managers with extended short positions and mutual fund managers underweight growth-sensitive stocks and overweight cash, raising the risk of a squeeze higher for equities if data comes in any better than downbeat expectations.

"We think the markets have already priced in a lot of soft growth in the first half'" Kurtz said. "There is a risk of a perfect storm for upside surprises."

UNCERTAIN OUTLOOK

The global economic outlook may be dark -- courtesy of Europe's festering debt crisis and still anaemic consumption in the United States -- but conditions are arguably better than those in late 2008 when global financial markets were in chaos and the HSBC Service PMI sank into the low 50s.

The latest index reading of 52.5 is above levels in the first quarter of 2011 when Chinese monetary tightening was in full swing, dampening both domestic inflation and economic activity.

Sub-indexes of prices charged and outstanding business edged below 50, although both gave readings consistent with the history of the survey -- respondents appear to have an entrenched view that they have limited pricing power and insufficient work outstanding.

Business expectations fell to the lowest in the services PMI's history -- though that sub-index remains far and away the most robust element of the overall survey -- and were a clear signal to HSBC of the need for policy action to support economic growth in the months ahead.

"More headwinds are down the road due to the still weak manufacturing sector, slower jobs growth, the ongoing property correction and cooling external demand. All these factors call for more aggressive easing measures," Qu said.

Investor expectations are building that China is poised to announce a further easing of monetary conditions after a 50 basis point cut in late November to the ratio of cash banks are required to keep as reserves.

That reduction, from a record high of 21.5 percent, is estimated to have injected about 350 billion yuan ($56 billion) of credit into the economy.

Analysts expect fourth-quarter growth data from China to show a further slowdown in the rate of economic expansion, with many forecasting annual growth to have fallen below 9 percent in the last three months of the year. - Reuters

KLCI steadies at mid-morning, Asian markets mixed

2012-01-05T11:00:00.001+08:00

KUALA LUMPUR (Jan 5): The FBM KLCI steadied at mid-morning on Thursday and was up 7.3 points to 1,511.25 at 10.01am, lifted by gains at select blue chips, while regional markets traded mixed.

Gainers led losers by 236 to 164, while 228 counters traded unchanged. Volume wa332.32 million shares valued at RM231.13 million.

Meanwhile, Asian shares and the euro eased on Thursday as concerns about the ability of euro zone countries to refinance their huge public debt dampened investor risk appetite ahead of a French bond auction later in the day, according to Reuters.

The euro zone's sovereign funding plans and US economic data, including U.S. jobs figures due on Friday, are the primary focus for market participants to gauge whether investors would take or avert risk, it said.

At the regional markets, Hong Kong's Hang Seng Index edged up 0.08% to 18,742.43, Taiwan's Taiex added 0.14% to 7,093.05 and South Korea's Kospi rose 0.39% to 1,873.41.

Meanwhile, Japan's Nikkei 225 fell 0.61% to 8,508.25, the Shanghai Composite Index dipped 0.07% to 2,167.91 and Singapore's Straits Times Index shed 0.02% to 2,710.48.

BIMB Securities Research in a note Jan 5 said attention on Eurozone crisis was back to haunt investors again after a few days of reprieve, adding that the situation was made worse from a weak capital raising exercise of '7.5bn by Italy's Unicredit.

As a result, jittery sentiments resurfaced and wiped out all gains made the previous day by European bourses as most ended in the red, it said.

Wall Street fared better with a 21 point gain buoyed by improved sales figures from the automakers, said the research house.

It said Asian bourses were apparently affected by the weak European performances with most charted into negative territory.

'Locally, the FBM KLCI fell for the second consecutive days possibly suffering from indigestion amid an overbought position.

'Expect the psychological 1,500 level to be tested today and it is crucial that this support level is maintained,' it said.

On Bursa Malaysia, Nestle was the top gainer at mid-morning and added 40 sen to RM56.40; Timwell gained 28 sen to RM1.08, United PLANTATION []s and Dutch Lady rose 20 sen each to RM19.40 and RM24.20, BHIC 17 sen to RM4.02, HLFG 14 sen to RM11.66, while F&N, Hong Leong Bank and UMW rose 10 sen each to RM18.22, RM10.84 and RM7.09 respectively.

Decliners included Far East, KrisAssets, IJM Corp, Dialog, IIGB, Toyo Ink and Hibiscus, while the actives included JCY, Proton, Astral Supreme and HWGB.

CIMB Research ups JCY target price to RM1.54

2012-01-05T10:00:00.009+08:00

KUALA LUMPUR (Jan 5): CIMB Research has raised its target price for JCY International Bhd to RM1.54 and has a trading buy on the hard disk drive maker.

It said on Thursday that JCY issued a positive profit guidance for the December quarter that was even better than its already-above-consensus estimate.

'We believe that the positive earnings momentum will continue for at least the next two to three quarters and should catalyse a rerating of the stock.

'The favourable impact of a higher ASP, better product mix and stronger US$ prompts us to revise our above-industry forecasts again for FY12-14. This raises our target price to RM1.54, still based on 6.0 times CY13 P/E. Maintain Trading Buy,' it said.

KLCI edges up in early trade but sentiment remains cautious

2012-01-05T10:00:00.007+08:00

KUALA LUMPUR (Jan 5): The FBM KLCI edged up in early trade on Thursday but sentiment remained cautious as the New Year rallies at most regional markets fizzled out with the eurozone debt crisis returning to weight on investors' minds.

At 9.05am, the FBM KLCI was up 2.62 points to 1,506.84.

Gainers led losers by 125 to 53, while 119 counters traded unchanged. Volume was 72.59 million shares valued at RM38.53 million.

Among the early gainers were Nestle, Timwell, United PLANTATION []s, Hong Leong Bank, HLFG, BHIC, IJM Plantations, Proton and SapuraCrest.

Meanwhile, JCY International Bhd was actively traded after the company said it was likely to record a surge in earnings for the quarter ended Dec 31, 2011.

JCY gained three sen to RM1.21 with 9.03 million shares done.

To cater for the increase in the component demands from the company's major customers, JCY has allocated RM300 million over the next 24 months period to expand its facilities in Malaysia, Thailand and China.

CIMB Research has technical buy on TSH at RM2

2012-01-05T10:00:00.005+08:00

KUALA LUMPUR (Jan 5): CIMB Equities Research has a technical buy on TSH Resources at RM2 at which it is trading at a price-to-book value of 2.0 times.

It said on Thursday that TSH tried to push above its triangle pattern the previous day.

'Looking at the chart, we think that the uptrend channel from its September's low could still last a while longer. Once the RM2.04 level is taken out, the following resistance targets are RM2.15 and RM2.30,' it said.

CIMB Research said the MACD signal line is poised for a positive crossover while RSI is above the 50pts mark. The improving technical landscape bodes well for the stock.

'Aggressive traders may start to nibble now. However, always place a stop at between RM1.91-RM1.85, depending on one risk's appetite,' it said.

''

CIMB Research has technical buy on SBC at 90.5 sen

2012-01-05T10:00:00.003+08:00

KUALA LUMPUR (Jan 5): CIMB Equities Research has a technical buy on SBC Corporation at 90.5 sen at which it is trading at a price-to-book value of 1.9 times.

It said on Thursday that SBC was trying to push above its triangle resistance. If it succeeds, there is a good chance that prices may re-rate towards 95 sen and 99.5 sen in the medium term.

'MACD signal line is slowly picking up, suggesting that buyers are slowly making a comeback. RSI too is above the 50pts mark.

'Traders should only get in when prices swing above its key moving averages at 90.5 sen to 91 sen. Be quick to cut loss if 85 sen is breached,' it said.

JCY active, up on positive profit guidance

2012-01-05T10:00:00.001+08:00

KUALA LUMPUR (Jan 5): JCY International Bhd shares were actively traded on Thursday after the company said it was likely to record a surge in earnings for the quarter ended Dec 31, 2011.

At 9.30am, JCY gained four sen to RM1.22 with 12.6 million shares done.

JCY said on Wednesday said that to cater for the increase in the component demands from the company's major customers, it had allocated RM300 million over the next 24 months period to expand its facilities in Malaysia, Thailand and China.

CIMB Research in a note Thursday said JCY's profit guidance for the December quarter was even better than our already-above-consensus estimate.

The research house JCY's positive earnings momentum would continue for at least the next 2-3 quarters and should catalyse a rerating of the stock.

'The favourable impact of a higher ASP, better product mix and stronger US$ prompts us to revise our above-industry forecasts again for FY12-14.

'This raises our target price to RM1.54, still based on 6x CY13 P/E. Maintain Trading Buy,' it said.

Seoul shares steady as holiday cheer wanes

2012-01-05T09:00:00.005+08:00

SEOUL (Jan 5) - Seoul shares were flat near the market open on Thursday as holiday cheer waned with investor focus returning to euro zone debt worries.

Banks shares retreated, with Hana Financial Group sliding 2.79 percent while Shinhan Financial Group was down 1.11 percent.

The Korea Composite Stock Price Index (KOSPI) was down 0.16 percent at 1,863.18 points as of 0005 GMT. - Reuters

Automakers see slower US sales growth in 2012

2012-01-05T09:00:00.003+08:00

DETROIT (Jan 4): U.S. auto sales rose 10 percent in 2011 but major automakers forecast a slowdown in growth this year because of weak job growth and risks to the American economy from a slowdown in Europe.

Auto sales have been a relative bright spot in the economy since late summer with cash-strapped consumers forced to buy to replace cars that have been on the road for a decade or more.

December U.S. auto sales rose 9 percent to hit an annualized sales rate of 13.6 million vehicles, in line with Wall Street expectations. Full-year 2011 sales totaled 12.8 million vehicles compared with 11.6 million in 2010.

Auto sales are tracked as an early indicator of consumer spending, and analysts said December results were boosted by lower interest rates and a greater selection of vehicles on dealer lots.

On a full-year basis, the biggest winners were Chrysler, bouncing back from crisis under the control of Fiat SpA , and Korean powerhouse Hyundai-Kia. Both posted a 26 percent gain in annual sales.

The biggest losers were Toyota Motor Corp and Honda Motor Co, which both saw U.S. sales drop 7 percent after the March earthquake in Japan shut down production and left dealer lots short of popular cars like the Camry and Accord.

Most major automakers forecast 2012 sales of between 13.5 million and 14 million vehicles, implying annual growth of between 5 and 9 percent. Ford Motor Co offered a wider estimate it said reflected the outside chance of another economic setback.

"The momentum coming out of the fourth quarter gives us confidence that the low end of that forecast is less likely," Ford economist Ellen Hughes-Cromwick said.

Even at the most optimistic projections, the U.S. auto industry would be far short of the nearly 17 million vehicle sales it averaged in a 10-year period through 2007.

Analysts said U.S. automakers have slashed enough jobs and closed plants to make money even at the bottom of the industry's bust cycle, but executives remain conservative.

"We're still in a recession-like industry," GM U.S. sales chief Don Johnson told analysts on a conference call after offering the automaker's growth forecast for 2012.

In one positive sign, the industry-wide increase in sales in December came without the cash-back offers and other costly incentives that automakers have sometimes relied on to lure consumers to showrooms.

The exception was for luxury cars. Daimler AG's Mercedes-Benz and BMW each piled on incentives last month as they raced to claim bragging rights as the most popular luxury brand in the American market.

Both German automakers said final sales figures were not ready as of Wednesday evening.

Chrysler and Volkswagen AG rose 37 percent and 36 percent, recording the strongest sales gains for the month. Ford Motor Co and General Motors Co posted increases of 10 percent and almost 5 percent.

Sales are expected to get a lift in 2012 because Americans have held back on replacing old cars for so long. The average car on the road is 11 years old, and Ford estimates about 50 million vehicles -- one of every five in use -- is older.

Guggenheim Securities analyst Matthew Stover said he expected industry-wide sales growth of just 4 percent this year, despite replacement demand for older cars and trucks.

"With relatively weak employment trends, sluggish real-income growth and consumer confidence that is improving but not strong by any stretch of the imagination, it doesn't feel to me like a traditional cyclical recovery," he said.

Toyota said its U.S. market share of about 14.4 percent in December was back to pre-March earthquake levels. The Japanese automaker expects its U.S. dealer inventory to be fully recovered by the end of March.

While Toyota sees U.S. industry sales up about 6 percent in 2012, it expects its own sales to rise 15 percent.

Ford's U.S. sales, which came in above expectations, were helped by its best month for retail sales -- as opposed to fleet sales -- since 2005.

The gain at Chrysler came with a refreshed lineup of cars and trucks. For the year, Chrysler's market share bounced back to almost 11 percent from just over 9 percent in 2010.

But Chrysler's owner, Fiat, fell far short of its sales target for the Fiat 500. The Italian-designed small car had sales of just over 19,000, well below the company's target of 50,000 in its return to the American market.

GM shares closed up 0.5 percent at $21.15 on Wednesday, while Ford shares gained 1.5 percent to close at $11.30. - Reuters

Nikkei falls, back below 25-day moving average

2012-01-05T09:00:00.001+08:00

TOKYO (Jan 5): Japan's Nikkei average fell in early trade on Thursday, giving up some of the previous session's hefty gains, weighed down by concerns over more capital raising by European banks to fight the debt crisis.

The Nikkei was down 0.7 percent at 8,503.13, just breaking below its 25-day moving average of 8,504, while the broader Topix slipped 0.5 percent to 739.22. - Reuters

Wall St flat as market brushes off Europe concerns

2012-01-05T07:59:00.002+08:00

NEW YORK (Jan 4): Major U.S. stock indexes were little changed in a low-volume session Wednesday, but some investors were encouraged to see equities avoid a sell-off amid the lingering euro zone's debt problems.

Indexes held on to the previous day's large gains even as the euro dropped sharply against the dollar. Notably, U.S. banks held up well, even though bad news in Europe centered around the difficulties for some European lenders.

Tight credit markets are making it expensive for European banks to raise capital and for euro-zone countries to refinance debt. The latest sign of stress came from Italy's biggest bank, UniCredit, which fell nearly 10 percent after it offered to sell 7.5 billion euros ($9.8 billion) in shares at a steep discount to shore up its balance sheet.

A gauge of European bank shares dropped 1.6 percent, but in New York the KBW bank index added 0.34 percent.

"Some of what's been going on in the last weeks is the U.S. is starting to delink from Europe," said Jim Paulsen, chief investment officer at Wells Capital Management in Minneapolis.

"Not that we've totally isolated ourselves, but the fact you're seeing more days when the euro is off and the market here is up is evidence of some delinking," he said. "If the U.S. economy is growing again, it's much less vulnerable to external shocks."

Investors were encouraged by a sharp rise in new orders for U.S. factory goods in November, further evidence the economy is recovering.

The euro, which moved in lockstep with equities for most of the past quarter, slumped to its lowest level against the dollar in nearly a week.

The once-tight relationship between the S&P 500 and the euro continues to fray. The 50-day correlation coefficient between S&P e-mini futures and the single currency fell to 0.22, its lowest since mid-September. A perfect correlation score is 1; a score of 0 indicates no correlation.

The Dow Jones industrial average gained 21.04 points, or 0.17 percent, to 12,418.42. The S&P 500 Index edged up 0.24 point, or 0.02 percent, to 1,277.30. The Nasdaq Composite dipped 0.36 point, or 0.01 percent, to 2,648.36.

U.S. new vehicle sales released on Wednesday showed automakers ended the year with strong sales, but they forecast lower growth in 2012.

GM shares rose 0.5 percent to $21.15, while Ford added 1.5 percent to $11.30.

Netflix Inc, down more than 60 percent last year, led consumer stocks higher with a 11.4 percent rise to $80.45. The S&P consumer discretionary sector rose 0.7 percent.

Yahoo Inc shares fell 3.1 percent to $15.78 after it named PayPal president Scott Thompson as its chief executive, taking over on Jan. 9 from interim CEO Tim Morse, who will resume his role as chief financial officer.

AT&T Inc agreed on Tuesday to pay TiVo Inc a minimum of $215 million and additional monthly licensing fees to settle a patent infringement dispute. AT&T shares gained 0.2 percent to $30.43, and TiVo jumped 10.1 percent to $9.82. - Reuters

Euro drops as debt funding fears keep investors wary

2012-01-05T07:59:00.001+08:00

NEW YORK (Jan 4): The euro fell to its lowest level against the dollar in nearly a week on Wednesday as a muted German Bund auction fueled fears that important upcoming sovereign debt sales may be met by mediocre demand.

While Germany's bond sale saw better demand than an auction in November that had raised fears the bloc's debt crisis was spreading to its strongest economy, rock-bottom yields kept some investors sidelined.

France will add to the brisk start to the 2012 debt auction calendar by selling up to 8 billion euros of bonds on Thursday.

But the key test of investor sentiment comes next week when Spain and Italy, the two countries most exposed to an escalation of the crisis, kick off their funding campaigns.

France is seen as having a greater risk of contagion from the euro-zone debt crisis than Germany. Analysts said lackluster demand at the auction could increase concerns that France will could lose its triple-A credit rating.

France and its euro zone peers were put on review for a possible downgrade by Standard & Poor's last month, and other ratings agencies have also warned that France's top-grade status may be at risk.

"We are in very risky world right now, and sentiment remains extremely fragile," said Brian Dolan, chief currency strategist at Forex.com in Bedminster, New Jersey. "Euro zone bonds did not benefit from yesterday's risk-on trade, and yields remain at unnerving levels," he said.

"The market is prepared for a French downgrade, so a one-notch downgrade would not be disastrous. But if they keep the outlook negative or downgrade the debt by more than one notch that could have a more significant impact."

The euro last traded down 0.8 percent to $1.2946, with a session low of $1.2896, according to Reuters data. Italy's 2012 upcoming debut bond sale will also be closely watched with 10-year yields again approaching the 7 percent level widely seen as unsustainable.

"Economic data today was mixed and risk sentiment has turned more bearish, aggravating pressures in the European bond market and weighing on the euro," said Camilla Sutton, chief currency strategist at Scotia Capital in Toronto.

"Two bond auctions today went off reasonably well considering the environment." Portugal, as well as Germany, sold debt on Wednesday, and its short-term borrowing costs fell to their lowest level since April. Dolan, of Forex.com, said the only factor inhibiting significant euro losses is a market already extremely short and pessimistic.

"Those looking to short the euro have likely already done so," he said. "Nevertheless, the euro should test a low of $1.20 in the next few months as European data confirms a recession."

Euro-zone economic data also tempered risk appetite. The latest set of purchasing managers' indexes suggest the region is on course for a moderate recession, even though the composite PMI reading was slightly better than expected.

Against the yen, the single currency was down 0.7 percent at 99.32 yen, holding above the decade low of 98.71 hit on electronic trading platform EBS in holiday-thin trade on Monday. The greenback was up 0.1 percent against the yen at 76.74 with a session peak of 76.82 yen, but still not far from the record low of 75.311 touched late last year on electronic trading platform EBS.

"That the yen has performed this strongly in a far from consistent risk environment, tends to refute one line of thinking that long yen is simply a short risk 'correlation' trade," according to Deutsche Bank.

The most important back-story to the yen's strong performance continues to be the unwillingness of long-term Japanese investors to recycle the current account surplus in unhedged form, the bank said in a research report.

The Swiss franc eased on Wednesday after a report that European Union governments have reached a preliminary agreement to ban imports of Iranian crude oil to the EU but have yet to decide when such an embargo would be put in place. The dollar last traded at 0.9416 Swiss franc, up 1 percent on the day, and the session peak of 0.9448 franc near a one-week high.- Reuters

Johor MB talks of KFCH, QSR privatisation

2012-01-04T21:06:00.007+08:00

KUALA LUMPUR, Jan 4 (Bernama) -- Following is BERNAMA's question-and-answer session with Johor Menteri Besar and Chairman of Johor Corporation (JCorp) Datuk Abdul Ghani Othman on KFC Holdings Bhd and QSR BRANDS BHD [] privatisation.

Q1: How does JCorp aims to acquire KFC Holdings Bhd (KFC) and QSR Brands Bhd (QSR)?

A: JCorp proposes to acquire 100 per cent of KFC's and QSR's business and undertakings through a special-purpose vehicle, Massive Equity (ME) Sdn Bhd. Massive Equity is majority-owned by JCorp (51 per cent) with CVC Capital Partners (CVC) owning 49 per cent. The offers were made at a price equivalent to RM4 per KFC share and RM6.80 per QSR share. When the transaction is completed, JCorp's stake in KFC will increase from 17 per cent to 51 per cent, while its interest in QSR will increase from 33 per cent to 51 per cent.

Q2: Have KFC and QSR accepted the ME (JCorp/CVC) offer?

A: Both the KFC and QSR boards have given the greenlight to the buyout offer made by JCorp and CVC, seven days after the offer was made; and their respective boards have also stressed that they are not seeking alternative bids from other parties. The next step is for the proposal to be presented to the shareholders of KFC and QSR for their approval.

Q3: What is the rationale behind the ME offer for KFC and QSR? Who is driving this transaction and what are the benefits?

A: This is part of the overall JCorp rationalisation programme for its various divisions to focus on their core businesses. For example, via this restructuring, Kulim would exit the food retail business and focus on PLANTATION []s. In fact, JCorp is reviewing all of its assets with a view to making them more efficient, while growing them in a focused manner and generating greater value.

JCorp is a state-owned entity and the Johor State Government is driving the overall rationalisation programme (including this transaction) to ensure the long-term sustainability of JCorp. We want JCorp to be a profitable SEDC, enabling it to play a significant socio-economic role in the state for the benefit of the rakyat. The transaction allows JCorp to directly access the cashflow of the two businesses compared to the current convoluted structure.

Q4: Why was CVC enlisted by JCorp to participate as its minority partner in this transaction?

A: CVC was brought in to help further improve the businesses of KFC and QSR. They were chosen carefully (among various alternatives) based on their strong track record and vast experience in managing similar businesses and investing in our region. They are friendly value-added partners who will work with us to ensure an even better KFC and QSR in the future.

Q5: Will JCorp incur any new debts from KFC and QSR acquisition?

A: This acquisition will be funded via a combination of cash (equity) and debt. However, the debt we are incurring is not at JCorp itself. Rather, it is at the acquisition company level, relying on the strength of the cash flow of the two businesses.

In addition, JCorp's current debt is being resolved. For example, JCorp's sale of palm oil plantations to Kulim (which was recently approved) is part of our plan to fulfil JCorp's 2012 debt obligations.

The RM700 million cash accruing from the estates sale is the first part of the expected RM1 billion cash to be generated for debt repayment prior to July 31, 2012 (being the due date for the bond repayment). The balance of RM300 million will come from internally-generated funds. As for the remaining JCorp debt obligations, we are finalising the repayment plan with advice from CIMB as our financial advisor. As part of the exercise, CIMB and Maybank will act as Joint Lead Managers for the issuance of new bonds in 2012.

Q6: Is this move a sell-out to outsiders and foreigners by JCorp as alleged by the Malay Chamber of Commerce?

A: This is not a sell-out to foreigners or outsiders. On the contrary, JCorp is actually privatising QSR and KFC to keep it within JCorp directly, whilst at the same time increasing JCorp's holdings in QSR and KFC from 33 per cent and 17 per cent, respectively, to a majority of 51 per cent.

This is merely an internal reshuffle to make the corporate structure of JCorp Group more efficient. The move will also present Kulim Berhad, which is currently the controlling shareholder of QSR, an opportunity to dispose its stake in the food retail business and focus on its core plantation business.

Q7: Does JCorp plans to retain KFC and QSR within the group or farm them out to other bidders?

A: JCorp Group has always maintained that it intends to keep the two businesses within the group believing in their long-term value. JCorp does not intend to sell this assets or flip them to a third party or strip their assets for cash. The entire transaction is premised on keeping the asset within the group. So it is baseless to claim otherwise. Had the intention been different, the businesses would have been sold much earlier.

Q8: Are QSR and KFC considering other offers?

A: In addition to JCorp's clear message that it won't sell, the intention not to entertain any other bids has also been made clear by both the KFC and QSR boards.

Q9: Will this move in any way harm Bumiputeras and/or the people's interests?

A: I wish to state clearly that KFC is a franchisee, so it is not a Bumiputera-only outlet, nor is it stated anywhere that it should only be owned by Bumiputeras. It is open to everyone. On the other hand, JCorp as a state government agency will continue to safeguard the interests of the rakyat, including in developing the Bumiputera community through various means. It has achieved many successes in this field and will continue to do so, not least by being more focused and profitable in its core businesses.

Q10: Is there any other "cheaper" way to execute the proposed acquisitions as claimed by some quarters?

A: There is no cheaper way for a third party to acquire QSR and KFC. Of course, acquiring Kulim's shares (as proposed by the Malay Chamber) may appear to be a way to gain control of QSR and thereby KFC. But for that to happen, Kulim and JCorp will first have to agree to sell to a third party. They are not interested to do so.

Nonetheless, even if that route was pursued by say the Malay Chamber, there is no cheaper way. It will still cost the Malay Chamber and its partners the whole amount, as acquiring Kulim's stake in QSR will trigger a mandatory general offer for the remaining shares held in QSR. It will also trigger a general offer on KFC shares as well. Essentially, the end effect is that you will have to acquire 100 per cent of both entities. So, certainly the RM1 billion or so proposed will not be sufficient. - Bernama

SE Asia Stocks-Most climb higher as foreign money returns

2012-01-04T21:06:00.005+08:00

BANGKOK (Jan 4): Most Southeast Asian stock markets pushed higher on Wednesday as renewed appetite for risk and strength in oil prices attracted funds to commodities and energy shares.

Better-than-expected economic data from major countries including the United States and China helped the outlook for the global economy, luring short-term traders.

Leading gainers, the main Philippine stock index climbed 1.5 percent to five-month highs. But Manila, which has extended its trading hours to a close of 0730 GMT, saw its turnover fall to 0.3 times its 30-day average, in line with thin trade in the region as a whole.

Jakarta's Composite Index gained 1.3 percent to the highest in more than three months and Singapore's Straits Times Index edged up 0.8 percent, earlier hitting a three-week high.

Thailand's SET index ended up 1.1 percent, erasing some of its early gains in late selling. The market hit a one-week high in early trade, boosted by gains in energy shares.

"It's the first day back. There was a strong rally yesterday that we missed, so it's a little bit of a catch-up there. I think a lot still depends on external factors," said Andrew Yates, head of international equity sales at broker Asia Plus Securities in Bangkok.

The Thai market reopened on Wednesday after the New Year hoidays. Foreign investors bought shares worth 1.4 billion baht ($44.37 million), the bourse said.

Stocks in Malaysia ended down 0.6 percent after a rise of almost 1 percent at one stage.The Malaysian bourse said domestic institutions and retail investors sold a combined 129 million ringgit ($41 million), offsetting the buying of foreign investors.

Funds that sold up last year have taken a medium-term view that markets should be better this year, traders in the region said. Investors also selectively bought stocks that were expected to publish strong earnings.

Among gainers, Singapore's Keppel Corp Ltd, the world's largest rig builder, rose nearly 1 percent because of the positive outlook for global offshore and marine spending.

In the energy sector, Thai explorer PTT Exploration and Production Pcl surged 4.2 percent and Indonesian coal miner PT Bumi Resources Tbk climbed 2.2 percent.

Asian stocks in general rose on Wednesday, with MSCI's broadest index of Asia Pacific shares outside Japan rising 1.4 percent at 1016 GMT.

Bucking the trend, Vietnam's Ho Chi Minh Stock Exchange Index edged down 0.3 percent as investors cashed in gains in blue chips such as Vietcombank, which fell 2.4 percent. - Reuters

Govt to consider any plan to enhance Felda Global Venture listing

2012-01-04T21:06:00.003+08:00

PUTRAJAYA, Jan 4 (Bernama) -- The government is prepared to listen to any proposal from any Felda interest group to enhance the listing process of Felda Global Ventures Holdings (FGVH) on Bursa Malaysia, Deputy Minister in the Prime Minister's Department Datuk Ahmad Maslan said.

He said on Tuesday that interest groups like Gabungan Peneroka Generasi Wawasan Felda Kebangsaan (Gempak) will be invited for discussions in the next few weeks.

"Groups with an interest in Felda can submit their proposals as soon as possible and I will forward them officially in one or two weeks.

"Official discussions with these interest groups are held so that a proposal paper can be submitted to the team preparing the listing document for approval by the Securities Commission," he said at a media conference here.

Ahmad said the consultations should be completed by the end of January and the listing document is expected to be ready in a month or two. FGVH is expected to be listed on the main board of Bursa Malaysia in April this year.

Earlier, he met representatives of Gempak led by its president Samsudin Othman and deputy president Tan Sri Rozali Ismail.

Ahmad again gave an assurance that the interests of Felda settlers would continue to be upheld with the listing of FGVH on Bursa Malaysia. - Bernama

JCY sees surge in earnings, approves RM300m capex

2012-01-04T21:06:00.001+08:00

KUALA LUMPUR (Jan 4): JCY International Bhd, whose share price had surged in recent weeks, has stated that the group is likely to record a surge in earnings for the quarter ended Dec 31, 2011.

In a statement to Bursa Malaysia on Wednesday, it said based on current available information, the group was likely to record an increase in net profit for the financial quarter ended Dec 31, 2011 'of approximately 1,900%' compared with a year ago where net profit was RM7.5million.

For the quarter ended Dec 31, 2011, it expected net profit to be an increase of 460% compared with the quarter ended Sept 30, 2011's net profit of RM26.4million.

JCY cited the surge in earnings to an increase in average selling prices caused by component shortages arising from the October 2011 floods in Thailand; effective product mix; appreciating US dollar against the ringgit and continuous efficient cost management.

'To cater for the increase in the component demands from the company's major customers, the board of directors has approved a capital expenditure budget of approximately RM300 million over the next 24 months period, for expansion of its facilities in Malaysia, Thailand and China,' it said.

JCY also said barring any unforeseen factors, the company expects to be able to increase its global market share of the hard-disk drive mechanical component industry over the next 24 months.

Priceworth unit apptd logging contractor in Solomon Islands

2012-01-04T20:06:00.003+08:00

KUALA LUMPUR (Jan 4): Priceworth International Bhd's unit has been appointed a contractor to carry out logging on Kolombangara Island, in the western province of Solomon Islands.

Priceworth said on Wednesday, its unit, Ligreen (SI) Ltd had sealed a logging management and TECHNOLOGY [] agreement with Success Company Ltd to undertake the logging at a concession site measuring 1,053 ha.

'The licensee and contractor shall jointly market the logs harvested from the concession area. In consideration of the logging activities to be carried out by the contractor, the contractor'' shall receive 55% of the declared sales contract from the licensee,' it said.

Priceworth said the upside from the contract was that the group would have access additional source of logs for the group's business involving the manufacturing and sale of timber products and logs.

SC approves AirAsia, MAS proposed warrants exchange

2012-01-04T20:06:00.001+08:00

KUALA LUMPUR (Jan 4): The Securities Commission has approved the proposed warrants exchange between AIRASIA BHD [] and MALAYSIAN AIRLINE SYSTEM BHD [] (MAS) under a tie-up between both airlines.

The airlines said in their statements to Bursa Malaysia on Wednesday the SC has approved the warrants exchange under the Capital Markets and Services Act 2007 of Malaysia.

However, the exchange was subject to the condition that their investment banks and the airlines comply with the relevant rules pertaining to the implementation of the proposal as stipulated under the SC's Equity Guidelines.

In August, 2011, the tie-up would see Khazanah Nasional Bhd, which owns 69.5% in MAS, taking up a 10% of shares in AirAsia. Tune Air Sdn Bhd, which owns some 23% in AirAsia will hold 20.5% shares in MAS.

The partnership was estimated to potentially save both airlines as much as RM1 billion annually.

GLOBAL MARKETS-Stocks, euro pressured ahead of German auction

2012-01-04T19:05:00.005+08:00

LONDON (Jan 4): Nerves ahead of a German debt auction helped put European stock markets in negative territory early on Wednesday and halted a surge for the euro after its biggest one-day gain in nearly two months.

The single currency was helped by U.S. and European manufacturing surveys which were broadly better than expected and showed American factories growing at their fastest pace in six months in December, lifting world markets.

The MSCI world equity index stood at its highest level in a month on Wednesday, helped by gains for Asian markets.

But European shares snapped a four-day rally at the open, edging lower on fears about the upcoming heavy load of euro zone issuance. The key FTSEurofirst 300 index fell about 0.3 percent in early trade.

Germany will sell 5 billion euros of 10-year Bunds, kicking off the new year's debt raising by euro zone sovereigns.

"I think demand for Bunds generally remains pretty strong. We're hopeful the full amount will get away quite easily," said Commerzbank economist Peter Dixon.

But markets are nervous because a similar sale in November did not receive enough bids to cover the amount offered, the first sign the crisis could even trouble the currency area's most successful economy.

The German debt sale will be followed by a similar auction by France on Thursday with Italy and Spain set to begin their 2012 funding the following week. Markets are particularly concerned about Italy's ability to cover around 100 billion euros of redemption and coupon payments in the first four months of the year.

Portugal will also sell up to 1 billion euros of three-month T-bills on Wednesday.

The euro stood at $1.3060 in early European trade, slightly firmer than afternoon Asia levels. It gained as much as 0.9 percent on Tuesday to reach its highest in a week at $1.3077 in the wake of the better-than-expected U.S. manufacturing report.

"The fact is that the euro has still many hurdles to clear. We think the euro will likely head to $1.25," Minori Uchida, a senior analyst at Bank of Tokyo-Mitsubishi UFJ. said, noting Italy's huge debt refinancing burden.

Also aiding the euro, were the minutes from the U.S. Federal Reserve's December meeting which the markets saw as dollar-negative.

The Fed said it would begin publishing forecasts on the path of interest rates later this month, a move that could suggest rates will be on hold for longer than previously expected. - Reuters

KLCI extends loss as renewed eurozone worries weigh on global markets

2012-01-04T19:05:00.003+08:00

KUALA LUMPUR (Jan 4): The FBM KLCI reversed its earlier gains and extended its losses on Wednesday as key regional markets retreated on renewed concerns over the eurozone debt crisis.

The FBM KLCI fell 9.32 points to 1,504.22, down from its intra-day high of 1,525.14.

Losers overtook gainers by 404 to 387, while 318 counters traded unchanged. Volume was 1.66 billion shares valued at RM1.53 billion.

Asian shares closed mixed, while European shares broke a four-session rally on Wednesday as concerns over the euro zone's huge refinancing needs lead investors to cash in on recent gains, according to Reuters.

Banking stocks, many of which are heavily exposed to euro zone debt, fell 0.9% ahead of a German debt auction later in the session, it said.

At the regional markets, the Shanghai Composite Index fell 1.37% to 2,169.39, Hong Kong's Hang Seng Index lost 0.80% to 18,727.31, and South Korea's Kospi was down 0.49% to 1,866.22.

Meanwhile, Japan's Nikkei 225 rose 1.24% to 8,560.11, Taiwan's Taiex up 0.42% to 7,082.97 and Singapore's Straits Times Index added 0.84% to 2,711.02.

On Bursa Malaysia, Petronas Dagangan lost 44 sen to RM17, Y&G down 24.5 sen to 75.5 sen, HLFG shed 22 sen to RM11.52, APM 20 sen to RM4.30, Mah Sing'' and UEM Land lost 15 sen each to RM1.95 and RM2.23, CIMB 14 sen to RM7.10, Ibraco 13 sen to RM1.23 and GAB fell 12 sen to RM13.22.

Among the gainers, Dutch Lady gained 58 sen to RM24, KLK 50 sen to RM23.50, Batu Kawan 48 sen to RM17.98, BAT 36 sen to RM49.80, BHIC 23 sen to RM3.85, Allianz 18 sen to RM4.94, Lafarge Malayan Cement 16 sen to RM7.14, Shell 15 sen to RM9.30 while MISC gained 13 sen to RM5.73.

The actives included HWGB, JCY, Hibiscus, Astral Supreme, Maxbiz and Nextnation.

BNM okays Hubline plan to issue more warrants to third party investors

2012-01-04T19:05:00.001+08:00

KUALA LUMPUR (Jan 4): HUBLINE BHD [] has received Bank Negara Malaysia's (BNM) approval to issue additional warrants to third party investors subscribing to its shares under a proposed private placement exercise.

The company said on Wednesday it had received BNM's letter, dated Dec 23, for the share issuance for the placement exercise, which might include non-resident investors.

Hubline had proposed to place out new share of20 sen each, representing up to 16.45% of its paid-up together with free detachable warrants on the basis of three additional warrants for every two placement shares subscribed.

Palm oil slips after weather driven-rally

2012-01-04T16:05:00.001+08:00

SINGAPORE (Jan 4): Malaysian crude palm oil futures eased on Wednesday as traders booked profits from a weather-fuelled rally that lifted the market to a six-week high the previous day although an improving global output limited losses.

Upbeat U.S. and European data pointed to improved growth prospects and commodity demand this year despite lingering worries over the euro zone debt crisis that helped palm oil notch its first annual decline since 2008.

For the first week of the new year, markets are focusing on dry weather in South America hurting soy yields and the potential for heavy Southeast Asian rains to disrupt palm oil production.

"Futures were a little overbought yesterday. Albeit the strong sentiment, product buyers were not enthusiastic at all yesterday. The high prices will dampen the already anaemic demand," said a dealer with a local commodities brokerage in Malaysia. "Healthy correction is in the making -- palm futures targeted to see RM3,150 to RM3,180 in the near term," the dealer added.

By the midday break, benchmark March palm oil futures on the Bursa Malaysia Derivatives Exchange fell 0.7 percent to RM3,204 (US$1,000) per tonne. The market started the year strongly on Tuesday, hitting a 6-week high of RM3,244, a level unseen since Nov. 21.

Palm oil futures are expected to peak about RM3,270 according to a wave analysis, said Reuters market analyst Wang Tao.

Traded volumes for palm oil futures on Wednesday stood at 6,840 lots of 25 tonnes, thinner than the usual 12,500 lots as some traders said they were waiting for further cues.

"There is no new catalyst. We have been talking on weather for too long and now all eyes are on December stock level," said another trader with a foreign commodities brokerage in Kuala Lumpur.

Reuters will release a survey on Malaysia's December palm oil stocks later in the day.

The Malaysian Meteorological Department issued a warning that heavy rains may trigger floods over low-lying areas for key oil palm growing states of Johor, Pahang and Sabah, which account for almost 60 percent of national palm oil output.

Heavy rains can often disrupt production and may further tighten stocks although traders have reported very few disruptions in deliveries owing to the floods. While Malaysian palm oil exports slipped in December, demand according to cargo surveyors hovered about 1.49 million tonnes -- a level that can further eat into stocks.

In related markets, oil prices surged with U.S. crude hitting the highest settlement since May, fuelled by strong economic data and mounting concern about supply disruption from Iran. U.S. soyoil for January delivery inched down 0.3 percent in Asian trade after rallying in the previous session on Argentine weather worries.

The most active Sept 2012 soyoil contract on China's Dalian commodity exchange gained 1.3 percent on the back of stronger global economic sentiment.- Reuters

KLCI pares down gains at mid-day, Asian markets mixed

2012-01-04T15:04:00.005+08:00

KUALA LUMPUR (Jan 4): The FBM KLCI pared down it gains at the mid-day break on Wednesday as the Hong Kong and China markets retreated into negative territory, while other markets saw limited gains.

Hong Kong shares reversed early gains to finish lower at midday on Wednesday, underperforming Asian peers, with lackluster turnover suggesting investors were cautious, refraining from chasing recent gains, according to Reuters.

Mainland Chinese markets reopened after a New Year holiday to an ambivalent start despite expectations that some favourable policy news over the long weekend could boost sentiment. Weakness in China weighed on Hong Kong, Reuters cited traders as saying.

The FBMKLCI was up 1.21 points to 1,514.75 at 12.30pm, lifted by gains at select blue chips. The index had earlier risen to its intra-morning high of 1,525.14.

Gainers led losers by 377 to 269, while 306 counters traded unchanged. Volume was 958.42 million shares valued at RM782.15 million.

The ringgit strengthened 0.38% to 3.1388 versus the US dollar; crude palm oil futures for the third month delivery fell RM23 per tonne to RM3,198, crude oil shed 17 cents per barrel to US$102.79 while gold lost US$4.50 an ounce to US$1,599.00.

At the regional markets, Japan's Nikkei 225 was up 1.32% to 8,566.67, Singapore's Straits Times Index added 0.54% to 2,702.87, Taiwan's Taiex rose 0.32% to 7,075.94 and South Korea's Kospi edged up 0.01% to 1,875.57.

Meanwhile, Hong Kong's Hang Seng index fell 0.29% to 18,822.68 and the Shanghai Composite Index shed 0.22% to 2,194.67.

On Bursa Malaysia, Dutch Lady was the top gainer at the mid-day break and was up 78 sen to RM24.20.

Other gainers included KLK that rose 60 sen to RM23.60, BAT 44 sen to RM49.88, Batu Kawan 40 sen to RM17.90, BHIC 22 sen to RM3.84, Shell 15 sen to RM9.30, MISC 13 sen to RM5.73, Ajiya and Jaya Tiasa up 12 sen each to RM1.75 and RM7.02, while LPI Capital added 10 sen to RM13.78.

Among the decliners, Petronas Dagangan fell 22 sen to RM17.22, GAB down 12 sen to RM13.22, Kluang 11 sen to RM2.54, AIC 10 sen to RM1.20, Iretex nine sen to 91 sen, while Tradewinds, Asdion and UEM Land lost seven each to RM9.90, 35 sen and RM2.31 respectively.

The actives included HWGB, JCY, Maxbiz, Envair, XDL, Karambunai and Nextnation.

EPF sells 3.54m UOA Devt shares

2012-01-04T15:04:00.003+08:00

KUALA LUMPUR (Jan 4): The Employees Provident Fund (EPF) disposed of 3.534 million shares of UOA Development Bhd on Dec 29.

A filing with Bursa Malaysia on Wednesday showed that after the disposal, the EPF's shareholding was reduced to 59.95 million shares or 5.01%.

The share price closed at RM1.37 on Dec 29.

Listed in May 2011, the current share price of RM1.37 is RM1.15 below its final retail price of RM2.52. The institutional price was fixed at RM2.60.

BCorp gets Bursa Securities' nod for RM765m new loan stocks

2012-01-04T15:04:00.001+08:00

KUALA LUMPUR (Jan 4): BERJAYA CORPORATION BHD [] has received Bursa Malaysia Securities Bhd's approval for a corporate exercise involving the issuance of RM765.32 million new loan stocks under its rights issue.

It said on Wednesday that Bursa Securities had in its Jan 3 letter approved the corporate exercise subject to obtaining approval from the Securities Commission for the issuance of the new ICULS.

BCorp planned to issue up to RM765.32 million nominal value of 10-year 5% irredeemable convertible unsecured loan stocks (ICULS)at 100% of its nominal value together with 765.32 million free detachable warrants.

It also proposed to privatise Cosway Corporation Ltd, a 56.83% subsidiary of BCorp.

SC reprimands Mulpha International directors

2012-01-04T14:34:00.001+08:00

KUALA LUMPUR (Jan 4): The Securities Commission has reprimanded the board of the directors of MULPHA INTERNATIONAL BHD [] for failure to ensure the full disclosure of information in its abridged prospectus.

The SC said on Wednesday 4 that Mulpha was reprimanded the previous day for failure to ensure the final basis of allocation of excess rights shares was consistent with the basis disclosed in the company's abridged prospectus dated Feb 24, 2010.

Media Prima dips, Affin Research has Sell, TP RM1.68

2012-01-04T14:04:00.001+08:00

KUALA LUMPUR (Jan 4): Shares of MEDIA PRIMA BHD [] were marginally lower at RM2.54 at the midday break with trading volume on the thin side while Affin Investment Bank Research was cautious on the outlook for the group.

At 12.30pm, it was down one sen to RM2.54. There were 277,200 shares traded at prices ranging from RM2.54 to RM2.55.

The FBM KLCI was up just 1.21 points to 1,514.75. Turnover was 958.42 million shares valyed at RM782.15 million. Tthe overall broader market was slightly higher with advancing stocks lead decliners 377 to 269 while 306 counters were unchanged.

Affin Research said Media Prima was trading at a forward price-to-earnings (PE) multiple of 17 times (near its +1 standard deviation mean PE) but it was likely to come off, and could potentially test its -1SD historical mean PE level of 10.8 times, triggered by earnings disappointment ahead.

'Our FY12-13 EPS estimates are 10%-30% below street. Risk to our anti-consensus SELL rating lies on us being too early in our recommendation as the stock price could potentially be lifted by an election rally.

'Nevertheless, we believe that any stock price rally would optimally be the best time to trim positions in the stock ahead of a more challenging adex environment in 2012,' it said.

Affin research said Media Prima was highly leveraged to the broadcast segment which was highly vulnerable to an economic slowdown.

'Maintain our SELL rating on Media with an unchanged target price of RM1.68 based on 12x FY12 EPS,' it said.

''

KLCI remains edgy, limited gains at mid-morning

2012-01-04T12:04:00.001+08:00

KUALA LUMPUR (Jan 4): The FBM KLCI rose at mid-morning on Wednesday in line with its regional peers, but the gains were limited as investors remained cautious given the continuing concerns over the eurozone debt crisis.

Asian stocks and the euro firmed after upbeat U.S. and European economic data boosted global shares and commodities, according to Reuters.

The FBM KLCI added 5.38 points to 1,518.92 at 10am.

Gainers led losers by 339 to 125, while 230 counters traded unchanged. Volume was 521.62 million shares valued at RM327.52 million.

At the regional markets, Japan's Nikkei 225 rose 1.32% to 8,566.95, Hong Kong's Hang Seng Index edged up 0.15% to 18,904.86, the Shanghai Composite Index added 0.77% to 2,216.39, Taiwan's Taiex was up 0.78% to 7,108.52 and Singapore's Straits Times Index rose 0.79% to 2,706.66.

Meanwhile, South Korea's Kospi shed 0.02% to 1,875.03.

RHB Research in its market update on Jan 4 said that 2012 starts with the overhanging concerns of 2H 2011, this could be another year of 'more of the same'.

However, on a brighter note, it noted the possibility of two market rallies in the near term ' 'January effect' and 'Chinese New Year rally'.

It said that while the January effect had been evident every year for the last 10 years (and had led to a positive annual return in seven of the 10 years), the historical data for the pre-Lunar New Year rally was less conclusive (but the post-festival returns have actually been negative in 7 of the last 10 years).

'Beyond January, we believe 2012 will be influenced by 2011 legacy issues.

'We thus continue to advocate a cautious stance, although we also recommend accumulating fundamentally-robust stocks on weakness for tactical plays with a longer-term view towards the recovery that will undoubtedly follow,' it said.

On Bursa Malaysia, BAT and KLK rose 44 sen each to RM49.88 and RM23.44, United PLANTATION []s 22 sen to RM19.40, Allianz 19 sen to RM4.95, YHS 16 sen to RM2.22, Batu Kawan 14 sen to RM17.64, Ajiya 12 sen to RM1.75, Jaya Tiasa 11 sen to RM7.01 while BHIC and DiGi added nine sen each to RM3.71 and RM3.90.

The actives included HWGB, Maxbiz, JCY, Envair, Karambunai and XDL, while decliners included Asdion, Tradewinds, Hibiscus, Yinson, Harrisons, Sime Darby, Kretam and Tanjung Offshore.

CIMB Research has technical buy on Landmarks at RM1.10

2012-01-04T10:33:00.009+08:00

KUALA LUMPUR (Jan 4): CIMB Equities Research has a technical buy on Landmarks at RM1.10 at which it is trading at a price-to-book value of 0.3 times.

It said on Wednesday Landmarks has been hovering near its 30-day and 50-day SMAs after prices broke out of its wedge resistance.

'We think a base has been formed and prices are likely to push for one more upswing,' it said.

CIMB Research said the MACD has staged a positive crossover while RSI is above the 50 points mark. The next targets to beat are RM1.16 and RM1.20. The 200-day SMA at RM1.28 would also be a magnet for prices.

'Traders may start to take some position now before the next upleg kicks in. However, always put a stop at below RM1.03,' it said.

HDBSVR: Firmer Wall Street to boost Malaysian market sentiment

2012-01-04T10:33:00.007+08:00

KUALA LUMPUR (Jan 4): Hwang DBS Vickers Research said on Wednesday Wall Street was off to a strong start in the New Year when key U.S. equity indices jumped between 1.5% and 1.7% last night.

It said apparently, investors' confidence was boosted by expectations that the global manufacturing sector would show promising growth this year.

'The positive external vibes could give a lift to our Malaysian bourse today. Its benchmark FBM KLCI will probably recover all the losses suffered yesterday to rise towards the immediate resistance level of 1,530 ahead,' it said.

HDBSVR said stocks that may see action today include: (a) CI Holdings, after a local daily, quoting sources, reported that the company is looking to acquire a new business soon; (b) Bonia, following its acquisition of a German leather goods maker for RM13 million; and (c) Tricubes, which has just been awarded a government contract worth RM6 million.

RHB Research maintains Underweight on semicon sector

2012-01-04T10:33:00.005+08:00

KUALA LUMPUR (Jan 4): RHB Research Institute is maintaining its Underweight call on the semiconductor sector as it has yet to see any strong indications that the industry is poised for a stronger recovery.

It said on Wednesday the EU debt crisis has already taken its toll on the chips demand in the region as reflected by a sharper decline of 11.5% on-year in November (versus October: 7.7%).

'Although sales of smartphones with the latest wireless chips remained the bright spot for the industry, this was not able to offset the weak demand from the broader market.

'We believe that chip sales (especially from the US and Europe regions) will be a better indicator as to whether a sustainable recovery is in sight,' it said.

On the outlook for MPI, it said although MPI was focusing on new segments such as the automotive and mobile devices (i.e. X3-MLP and MEMS), it believes the slowing consumer spending on the broader market such as PCs and consumer electronics would have bigger knock-on effects on MPI's medium-term earnings.

'This is mainly because revenue contributions from these segments are the highest. Hence, we maintain our Underperform call on the stock and a fair value estimate of RM2.10/share based on 0.6 times forward P/BV,' it said.

RHB Research also said Unisem was not spared too despite qualifying for new customers. Unisem's earnings visibility remains poor given weak order visibility and customers' lower order rate despite commencing volume loading for newly acquired customers.

'We believe medium-term chips demand would remain uninspiring given weakness in end-market demand for consumer electronics and corporate IT equipment. Therefore, we reiterate our Underperform call and fair value estimate of RM0.92/share based on 0.6 times forward P/BV,' it said.

As for Notion Vtec, the research house said while it remains positive on Notion's camera segment on the back of rising adoption of SLR cameras amongst consumers, it is wary of its renewed focus on the HDD business.

'Recall that the company incurred substantial cost increase following its capacity ramp-up of its 2.5'' HDD in FY09/10. Furthermore, we believe demand for HDDs could be hampered in the longer term by demand for alternative storage mechanisms i.e. cloud computing and hybrid storage. Thus, we maintain our Underperform call on the stock with a fair value estimate of RM1.21/share based on 6x FY09/12 EPS,' it said.

KLCI rebounds in early trade as Asian stocks rise

2012-01-04T10:33:00.003+08:00

KUALA LUMPUR (Jan 4): The FBM KLCI rebounded in early trade in line with the higher opening at regional markets following the firmer overnight close at Wall Street.

Asian stocks and the euro firmed on Wednesday, as investor risk appetite returned after upbeat U.S. and European economic data boosted global shares and commodities and hopes for improved growth outlook grew despite worries over the euro zone debt crisis, according to Reuters.

The FBM KLCI was up 11.60 points to 1,525.14 at 9.05am.

Gainers beat losers by 194 to 18, while 129 counters traded unchanged. Volume was 98.88 million shares valued at RM62.41 million.

Among the early gainers were KLK, BAT, Hong Leong Bank, Allianz, DiGi, Harvest Court, Scientex, IGB, IOI Corp and Cepat.

Meanwhile, Maxbiz was the most actively traded counter after it received a letter of intent (LOI) in respect of a fibre-to-the-home and fibre-to-the-office (FTTX) contract worth RM510 million.

Maxbiz gained one sen to 18.5 sen with 10.73 million shares done.

The company had received the LOI from Fiber-N Sdn Bhd on Dec 30, 2011 for the infrastructure works for 100,000 FTTX connections on high rise residential and office buildings in Klang Valley, Penang and Johor Bahru.

LBS Bina advances on RM1b annual sales target

2012-01-04T10:33:00.001+08:00

KUALA LUMPUR (Jan 4): LBS BINA GROUP BHD [] shares advanced on Wednesday after the company said it was targeting RM1 billion annual ''property sales target in the near term as the company focuses on the various segments of the residential market apart from commercial and industrial PROPERTIES [].

At 9.25am, LBS was up two sen to 80.5 sen with 1.43 million shares done.

Its managing director Datuk Lim Hock San on Tuesday said LBS was expected to achieve property sales of RM800 million and RM 950 million in the financial year ending Dec 2012 and 2013 respectively.

Nikkei up over 1 pct after US data,tops 25-day avg

2012-01-04T09:33:00.009+08:00

TOKYO (Jan 4): Japan's Nikkei average rose more than 1 percent on Wednesday to trade above its 25-day moving average after better-than-expected economic data from the United States, China and Germany.

The Nikkei was up 1.3 percent at 8,570.72, while the broader Topix climbed 1.4 percent to 739.05. - Reuters

Seoul shares open modestly higher; refiners rally

2012-01-04T09:33:00.007+08:00

SEOUL (Jan 4): Seoul shares opened slightly higher on Wednesday after solid gains in U.S. and European stocks, with positive U.S. CONSTRUCTION [] and factory data further buoying investor sentiment.

Rises were led by crude oil refiners, with SK Innovation , parent of the country's top refiner, advancing 1.7 percent and GS Holdings, the holding company of South Korea's No.2 refiner GS Caltex, climbing 1.1 percent.

The Korea Composite Stock Price Index was up 0.38 percent at 1,882.57 points as of 0004 GMT. - Reuters

MF Global sold assets to Goldman before collapse-sources

2012-01-04T09:33:00.005+08:00

(Jan 4) - MF Global unloaded hundreds of millions of dollars' worth of securities to Goldman Sachs in the days leading up to its collapse, according to two former MF Global employees with direct knowledge of the transactions. But it did not immediately receive payment from its clearing firm and lender, JPMorgan Chase & Co, one of the sources said.

The sale of securities to Goldman occurred on Oct. 27, just days before MF Global Holdings Ltd filed for bankruptcy on Oct. 31, the ex-employees said. One of the employees said the transaction was cleared with JPMorgan Chase.

At the same time MF Global, which was run by former Goldman Sachs head Jon Corzine, was selling securities to Goldman to raise badly needed cash, the futures firm was also drawing down a $1.2 billion revolving line of credit it had with JPMorgan, according to one of the former MF Global employees.

JPMorgan spokeswoman Mary Sedarat said the bank did not withold money because of the line of credit. She declined further comment on details of the transactions.

JPMorgan has fought aggressively in bankruptcy court to protect its interests, and received a lien on some of MF Global's assets in exchange for granting the firm $8 million to fund its bankruptcy costs. The lien puts JPMorgan's interests ahead of MF Global customers who have not yet received an estimated $900 million worth of money from their accounts, which remain frozen as regulators search for missing funds.

The hastily crafted transactions and the seeming inability of MF Global to recoup some of the money in the sale to Goldman may start to explain why so much money remains unaccounted for at the futures firm.

It is unclear what type of assets Goldman bought from MF Global, but the securities were worth hundreds of millions of dollars, the former employees said. The sources spoke on the condition of anonymity.

The Wall Street Journal previously reported that George Soros' fund was a buyer of securities sold by MF Global, scooping-up some of its European sovereign debt at a deep discount. Panic among investors and clients about MF Global's $6.3 billion bet on European sovereign bonds led to its demise.

Corzine, who was CEO of MF Global at the time of the collapse, headed Goldman Sachs from 1994 to 1999 before being ousted after a power struggle with co-CEO Henry Paulson.

Corzine and other top MF Global executives reached out in desperation to Goldman Sachs Group Inc and JPMorgan, as well as Jefferies Group Inc Barclays Plc, Citigroup Inc, Deutsche Bank AG, Macquarie Group Ltd, State Street Corp and Wells Fargo & Co, as potential buyers in its final days as the firm teetered toward collapse, Reuters earlier reported. - Reuters

CIMB Research has technical buy on MPHB at RM2.74

2012-01-04T09:33:00.003+08:00

KUALA LUMPUR (Jan 4): CIMB Equities Research has a technical buy on MULTI-PURPOSE HOLDINGS BHD [] (MPHB) at RM2.74 at which it is trading at a price-to-book value of 1.4 times.

It said on Wednesday MPHB broke out of its downtrend channel few weeks ago and prices have been consolidating sideways since then.

'Looking at the chart, we think the stock is ripe for a stronger rebound. A break above its 200-day SMA (now at RM2.78) would catalyse its share price performance,' it said.

CIMB Research said once this level is taken out, prices are likely to charge towards the RM2.87-RM2.94 gap and RM3.03. Only a break below RM2.63 would trigger its stop.

'Technical landscape is improving. MACD signal line remains in the positive territory while RSI has hooked upward,' it said.

CIMB Research has technical buy on TH Plantations at RM2.19

2012-01-04T09:33:00.001+08:00

KUALA LUMPUR (Jan 4): CIMB Equities Research has a technical buy on TH PLANTATION []s at RM2.19, at which it is trading at a price-to-book value of 1.9 times.

It said on Wednesday TH Plantations broke out of its triangle resistance on Tuesday.

'If prices can continue to hold above this level (now at RM2.17), there is a good chance that prices may push for one more upleg, possibly towards the RM2.28 high again. The following resistance levels are RM2.40 and RM2.55,' it said.

CIMB Research said the MACD signal line is poised for a positive crossover while RSI has also hooked upward. Hence, we think the bulls have the upper hand here.

It said aggressive traders may start to nibble now. However, always put a stop at below RM2.08 to keep loss tight.

Wall St starts 2012 higher on signs of global growth

2012-01-04T08:33:00.003+08:00

NEW YORK (Jan 3): Hoping for something better than 2011's flat stock market, U.S. investors pushed shares higher on Tuesday to begin the new year, though questions remain about whether a rally can be sustained.

The broad S&P 500 index closed at its highest since late October as traders, with cash on hand for the new year, welcomed better-than-expected German and Chinese economic data.

The upbeat response was reinforced by U.S. economic reports showing CONSTRUCTION [] spending and factory activity beat economists' forecasts.

"There were some good economic numbers from outside the U.S., and people have cash to invest for the new year so that's driving up prices," said Giri Cherukuri, head trader at OakBrook Investments in Lisle, Illinois. "It's a good start but we'll have to wait and see for the trend."

Trading volume was below normal. About 7 billion shares changed hands on the New York Stock Exchange, the Nasdaq and Amex, compared with last year's daily average of about 7.84 billion shares.

Advancers led decliners on the New York Stock Exchange by more than 16 to 5 and by about 14 to 5 on the Nasdaq.

Materials companies and financials, the lagging sectors in 2011, were among Tuesday's market leaders with the KBW bank index up 3.3 percent. U.S. Steel gained 6.5 percent to $28.17 after losing more than half its market value in 2011.

Strategists polled by Reuters in December expect the benchmark S&P 500 index to finish 2012 at 1,340 for a yearly gain of 6.6 percent. That compares with the S&P's mere 0.003 percent slip in 2011.

Data showed U.S. manufacturing sector growth accelerated in December at its strongest pace since June, while construction spending in November surged to the highest in nearly 18 months.

Some of the S&P 500's worst performers last year rallied on Tuesday. But at the same time, McDonald's Corp, the biggest gainer in 2011 among Dow components, fell 1.5 percent to $98.84.

First Solar, down 74 percent in 2011, jumped 6 percent to $35.79 and Netflix, off more than 60 percent last year, added 4.3 percent to $72.24.

The Dow Jones industrial average rose 179.82 points, or 1.47 percent, to 12,397.38. The S&P 500 Index added 19.46 points, or 1.55 percent, to 1,277.06. The Nasdaq Composite gained 43.57 points, or 1.67 percent, to 2,648.72.

The market's rise was foreshadowed by a large jump in stock index futures after weekend data showed China, the world's largest consumer of metals, avoided economic contraction in December.

Also boosting investors' mood was German unemployment, which declined more than forecast.

Indexes held on to gains after minutes from last month's Federal Reserve meeting said a number of Fed officials believed economic conditions could well warrant a further easing of monetary policy.

Among declinging stocks, Exelon Corp fell 3 percent to $42.07 after a downgrade from Macquarie and other utility shares also lost ground as natural gas futures hit their lowest intraday price since September 2009.

S&P utilities, the best performers last year among the top ten sectors on the S&P 500, fell 1.7 percent. - Reuters

GLOBAL MARKETS-Euro, stocks up on data, U.S. Fed

2012-01-04T08:33:00.001+08:00

NEW YORK (Jan 3): Stocks and the euro started the year with a sharp rally Tuesday, boosted by better-than-expected U.S. and European data and hopes the Fed could ease monetary policy further, even as crude surged on tensions between the United States and Iran.

A number of U. S. Federal Reserve officials believed economic conditions could "well" warrant a further easing of monetary policy, according to Dec. 13 meeting minutes released on Tuesday.

This month the Fed will begin issuing policymaker forecasts for its benchmark interest rate and when officials expect the first rate rise to occur.

The euro hit a session high as the minutes were released, advancing to $1.3076 before paring gains to 0.93 percent, or $1.3048, above its 2011 trough of $1.2858 hit last week on trading platform EBS.

The Fed minutes came after data were released showing growth in U.S. manufacturing accelerated in December to its fastest pace since June, while a sharp drop in German joblessness to the lowest in two decades whetted global risk appetite.

"The euro's gains are a combination of both earlier momentum stemming from economic data and the headlines from the (Fed) minutes," said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington.

"The dollar was already on the defensive today, but the minutes in my opinion do suggest that the Fed is still open to easing monetary policy, which is negative for the dollar."

Asian markets rose after data showed that China's big manufacturers narrowly avoided a contraction in December, though downward risks persist.'' European stocks closed at their highest in five months on Tuesday.

The FTSEurofirst 300 index of top European shares ended the day up 1.59 percent.

Data showed German unemployment fell more than expected in December, with the jobless rate falling to the lowest since the unification of Germany. U.S. stock indexes rallied sharply, hitting multi-month highs.

The Dow Jones industrial average climbed as much as 2.15 percent, hitting its highest since July, before paring gains to close up 1.47 percent. The Nasdaq Composite Index added 1.67 percent.

The Standard & Poor's 500 Index gained 1.55 percent after having notched its highest intraday level since late October. Another report showed U.S. CONSTRUCTION [] spending surged to a near 1-1/2-year high in November. The data added to growing hopes that a recovery in the U.S. economy, the world's largest, could be gaining steam.

U.S. Treasuries prices fell in thin trading as investors cashed in year-end gains. The safe-haven appeal of U.S. government debt diminished after the December factory report.

"The beginning of the year tends to start out positive as people want to put money to work, but the overseas data can't be overstated in its importance, especially since the U.S. data has been so strong as well," said Sal Catrini, a managing director for equities at Cantor Fitzgerald & Co in New York.

Global stocks as measured by the MSCI world equity index rose 1.8 percent and hit a near one-month high.

The Reuters-Jefferies commodities index jumped 2.64 percent, its best single-day performance since late September. Brent February crude rose $4.75, or 4.42 percent, to settle at $112.13 a barrel, the highest settlement since the Nov. 15 close at $112.39.

Military exercises in the Gulf by Iran and the movement of U.S. naval vessels in the area have raised fears of a confrontation between Tehran and Washington that could cut off oil exports from the region.

Iran has said it could shut the Strait of Hormuz at the mouth of the Gulf, through which 40 percent of world oil is shipped, if sanctions were to be imposed on its crude exports.

In addition, U.S. commercial crude oil stockpiles were expected to have fallen last week as refiners drew down inventories and limited imports to lower their year-end tax requirements, according to a Reuters poll ahead of weekly supply data.- Reuters

#Stocks to watch:* JCY, Dialog, AirAsia, MAS

2012-01-04T02:17:00.000+08:00

KUALA LUMPUR (Jan 5): Despite the second day of pullback on the local stock market , especially blue chips on Wednesday, the overall market sentiment continues to be firm due to the "January effect" while fresh corporate news could stir buying interest in selected stocks at least in the short-term.

However, RHB Research Institute was cautious as due to the overhanging concerns of the second half of 2011, it was'' fearful that this could be another year of 'more of the same'.

However, it did note the possibility of two market rallies in the near term, which were the 'January effect' and 'Chinese New Year rally'.

RHB Research said in a note on Wednesday that while the January effect has been evident every year for the last 10 years (and has led to a positive annual return in seven of the 10 years), the historical data for the pre-Lunar New Year rally is less conclusive (but the post-festival returns have actually been negative in seven of the last 10 years).

'Beyond January, we believe 2012 will be influenced by 2011 legacy issues. We thus continue to advocate a cautious stance, although we also recommend accumulating fundamentally-robust stocks on weakness for tactical plays with a longer-term view towards the recovery that will undoubtedly follow,' it said.

As for the stocks which could see trading interest on Thursday are hard-disk drive manufacturer JCY International Bhd, DIALOG GROUP BHD [], AIRASIA BHD [] and MALAYSIAN AIRLINE SYSTEM BHD [] (MAS).

JCY International Bhd, whose share price had surged in recent weeks, has stated that the group is likely to record a surge in earnings for the quarter ended Dec 31, 2011.

To cater for the increase in the component demands from the company's major customers, JCY allocated RM300 million over the next 24 months period to expand its facilities in Malaysia, Thailand and China.

Dialog could also see trading interest as its rights shares go ex on Thursday.

In December, Dialog fixed the rights shares at RM1.20 each and the exercise price of the warrants at RM2.40 each.

The issue price would be a discount of about 46% to the theoretical ex-rights price of RM2.23 per share, based on the five-day volume-weighted average market price (VWAMP) up to Dec 14 of RM2.43.

''

Meanwhile, the Securities Commission has approved the proposed warrants exchange between AirAsia and MAS under a tie-up between both airlines. The airlines said the SC has approved the warrants exchange under the Capital Markets and Services Act 2007 of Malaysia.

Priceworth International Bhd's unit has been appointed a contractor to carry out logging activities on Kolombangara Island, in the western province of Solomon Islands.

Priceworth said its unit, Ligreen (SI) Ltd had sealed a logging management and TECHNOLOGY [] agreement with Success Company Ltd to undertake the logging at a concession site measuring 1,053 ha.

KINSTEEL BHD [] had on Wednesday paid RM70 million to Perwaja Holdings Bhd which was the first payment for the subscription of the RCULS by Kinsteel. The balance of the RM210.0 million would be paid within 21 business days.

Following the first payment, Perwaja had provisionally allotted RM280.0 million nominal value of RCULS to Kinsteel.

''

Century Logistics expects repairs to Thai centre ready by 1Q

2012-01-03T23:06:00.003+08:00

KUALA LUMPUR (Jan 3): CENTURY LOGISTICS HOLDINGS BHD [] expects the complete repairs to its distribution centre in Rojana Industrial Park, Ayutthaya, Thailand to be ready by the first quarter of 2012.

It said on Tuesday the flood waters surrounding the distribution centre receded on Nov 28.

'Based on the preliminary assessment conducted by the loss adjustors of the insurers, there was clear indication that the 2.5 metres of floods since Oct 7, 2011 had caused some rust, corrosion and general contamination to the distribution centre,' it said.

Century Logistics added the removal of non structural debris and decontamination started on Dec 7. It added the final cleaning for the three-storey office complex and perimeter open space was underway and was expected to be completed in one week.

New substantial shareholder in Vastalux Energy

2012-01-03T23:06:00.001+08:00

KUALA LUMPUR (Jan 3): VASTALUX ENERGY BHD [], which managed to avert the delisting of its securities, has seen the emergence of a substantial shareholder, Tengku Uzir Tengku Ubaidillah.

Tengku Uzir, who is a director of Gas Altimate Services Sdn Bhd, acquired the 16.25 million shares or a 7.89% stake from the open market on Dec 28.

His entry could be part of the corporate exercise to rescue Vasatlux, whose shares has been suspended from trading since Dec 29.

The company is in the midst of drawing up a regularisation plan.

Vastalux, which faced suspension and delisting on Jan 3, 2012, had managed to submit its appeal to Bursa Malaysia Securities on Dec 23 last year.

As it had submitted the appeal within the timeframe, the regulator had deferred the decision to remove the company's securities pending its Appeal Committee's decision.

Maybank given until June to sell down stake in BII

2012-01-03T22:06:00.003+08:00

KUALA LUMPUR (Jan 3): MALAYAN BANKING BHD [] has been given a further extension until June 1, 2012 to sell down its stake in PT Bank Internasional Indonesia Tbk (BII).

Maybank said on Tuesday it had received a letter, dated Dec 27, from Indonesia's Badan Pengawas Pasar Modal dan Lembaga Keuangan (Bapepam) where the latter had given it more time to undertake the corporate exercise.

The corporate exercise is to fulfill the mandatory sell-down requirement for BII, after several extensions.

Maybank owns 97.5% of BII which it had acquired in 2008 amid much criticism that it had paid too much for the Indonesian bank.

Sime Darby expands into China's vehicle market

2012-01-03T22:06:00.001+08:00

KUALA LUMPUR (Jan 3): SIME DARBY BHD [] is expanding into China's vehicle market with the setting up of Chongqing Bow Chuang Motor Sales & Services Co., Ltd (CQBC).

The conglomerate said on Tuesday it received the business licence approval on Dec 30.

CQBC's registered capital would be 35 million renminbi (RM17.57 million) and held by Sime Darby's unit B.M.W. Concessionaires (H.K.) Ltd.

It added CQBC would be involved in the display of vehicles, provision of technical consultancy and marketing consultancy services for motor vehicles, sales of parts of vehicles and motorcycles.

Esthetics rights issue undersubscribed by 28%

2012-01-03T20:06:00.003+08:00

KUALA LUMPUR (Jan 3): ESTHETICS INTERNATIONAL GROUP [] Bhd's rights issue of 52.80 million new shares and 52.80 million free detachable warrants were undersubscribed by 28%.

The rights issue was on the basis of two rights shares and two warrants for every five shares held as at Dec 6, 2011 at an issue price of 50 sen per share.

Esthetics said at the close of acceptance and payment of the rights issue at 5pm on Dec 28, the total valid acceptances and total valid excess applications for the rights issue were 38.016 million rights shares, which was a subscription rate of 72%. Hence, 14.78 million rights shares of 28% were undersubscribed.

'In view that the rights shares with warrants have not been fully subscribed for, the board has resolved to allot the rights shares with warrants to all applicants who have applied for the excess rights shares with warrants.

'The undersubscribed rights shares with warrants will be subscribed by Esthetics' major shareholders namely, Providence Capital Sdn Bhd and Gambir Capital Sdn Bhd pursuant to their undertakings as stated in the abridged prospectus dated Dec 6, 2011,' it said.

GLOBAL MARKETS-Economic data gives fragile boost to stocks, euro

2012-01-03T20:06:00.001+08:00

LONDON (Jan 3): Resilience in the manufacturing sector and a surprise drop in German unemployment lifted global stocks and the euro on Tuesday but positive sentiment is seen vulnerable to a daunting schedule of first quarter debt issuance in Europe.

German unemployment fell more than expected in December, by 22,000 from the previous month to a seasonally adjusted 2.888 million, new data showed. The jobless rate edged down to 6.8 percent from 6.9 percent in November - a new record low since figures for unified Germany were first published.

"Firms are still willing to keep hiring. But we must brace ourselves for a deterioration on the labour market from the spring," said Commerzbank economist Eckart Tuchtfeld.

Europe's debt crisis still clouds the outlook, with heavy first quarter borrowing to refinance maturing debt expected to push the euro lower and undermine demand for the region's lower-rated sovereign debt.

"The maturing of debt is going to give investors the opportunity to take some of those funds back out of Europe, to repatriate some of those funds to reduce their exposure," said Ian Stannard, currency strategist at Morgan Stanley.

Signs of improved growth in the United States may also cool any speculation about another round of money-printing by the Federal Reserve, improving the outlook for the dollar.

The euro rose about 0.8 percent against the dollar to around $1.3030, but stayed within striking distance of its 2011 trough of $1.2858 hit last week.

The MSCI world equity index was up over 0.5 percent.

MANUFACTURING RESILIENCE

Recent slight rises in purchasing managers' indexes for China and the euro zone have encouraged risk appetite, especially in commodity markets.

China's official Purchasing Managers' Index rose to 50.3 in December from 49 in November - moving above the 50 mark which separates expansion from contraction.

Data on Tuesday also showed the official Purchasing Managers' Index for non-manufacturing sectors had rebounded strongly in December to 56.0 from 49.7 in November.

British manufacturing also beat expectations in December, showing signs of stabilising after a two-month decline as orders from China and Germany picked up, data on Tuesday showed.

Investors will closely watch the ISM Manufacturing PMI data in the United States, due at 1500 GMT, for further signs of recovery in the world's biggest economy, with economists in a Reuters survey expecting a reading of 53.2 versus 52.7 in November.

"The data we've seen coming from the U.S. has actually surprised on the upside over the past few weeks and I think that's going to continue," said Morgan Stanley's Stannard.

The pick-up in the PMIs encouraged European stocks to a fourth consecutive session of gains. The FTSEurofirst 300 index of top European shares was up 0.7 percent at 1019.38 points after rising as high as 1,022.85, its highest level in more than two months.

The heavily commodity-weighted UK FTSE 100 index was up 1.2 percent, lifted by strong gains in mining companies Xstrata and Kazakhmys, both up nearly 4 percent in early trade.

COMMODITIES RALLY

U.S. crude jumped nearly 2.5 percent to over $110 a barrel, in response to the escalating tensions between Iran and the West.

Military exercises in the Mideast Gulf by Iran and the movement of U.S. naval vessels in the area raised fears of a confrontation between Tehran and Washington that could cut off oil exports from the region.

Spot gold rose as much as 1.4 percent to $1,586.95 earlier on Tuesday, also helped by investors renewed appetite for riskier assets. - Reuters

KLCI starts 2012 in negative territory as rally fizzles out

2012-01-03T19:05:00.001+08:00

KUALA LUMPUR (Jan 3): The FBM KLCI fell into negative territory on the first trading day of 2012 as the rally fizzled out and profit taking activities chipped off its gains made during the final week of 2011.

The 30-stock index fell 1.12% or 17.19 points to 1,513.54, weighed by losses at banking and key blue chips.

The broader market sentiment however was mixed with gainers leading losers by 446 to 325, while 278 counters traded unchanged. Volume was 1.6 billion shares valued at RM1.41 billion.

Meanwhile, better-than-expected data from China's giant manufacturing sector boosted global stocks and the euro on Tuesday and pushed safe-haven bets like German bonds lower, according to Reuters.

Europe's debt crisis still clouds the outlook ahead of a daunting first quarter of borrowing which is expected to push the euro lower and undermine demand for the region's lower-rated sovereigns, it said.

Signs of improved growth in the United States may also cool any speculation about another round of money-printing by the Federal Reserve, improving the outlook for the dollar, it said.

At the regional markets, Hong Kong's Hang Seng Index jumped 2.4% to 18,877.41, South Korea's Kospi rose 2.69% to 1,875.41, Taiwan's Taiex gained 1.46% to 7,053.38 and Singapore's Straits Times Index added 1.59% to 2,688.36.

The China and Japan markets were closed today for holidays.

Banking stocks were among the major losers, with Maybank falling 24 sen to RM8.34, Public Bank down 22 sen to RM13.16, CIMB 20 sen to RM7.24, RHB Capital 17 sen to RM7.31, AMMB 15 sen to RM5.80 and Hong Leong Bank 14 sen to RM10.76.

Other losers included BAT that fell 48 sen to RM49.44, Petronas Dagangan 36 sen to RM17.44, Petronas Gas 30 sen to RM14.90, Nestle 20 sen to RM56, while JT International and PPB fell 18 sen each to RM7.21 and RM16.98.

Gainers included KLK that added 30 sen to RM23, Y&G 25 sen to RM1, Genting 24 sen to RM11.24, Hibiscus 22.5 sen to RM1.17, Glenealy, Toyo Ink, IGB and SOP up 20 sen each to RM6.22, RM1.80, RM2.66 and RM5.79, while KPower added 19.5 sen to 47 sen.

Meanwhile, the actives included Hibiscus, Maxbiz, XDL, JCY, Sanichi and DBE Gurney.

Sing dlr, ringgit breach resistance, Asia FX outlook cautious

2012-01-03T18:05:00.003+08:00

SINGAPORE (Jan 3): Short-term investors bought emerging Asian currencies on Tuesday, helping the Singapore dollar and the ringgit break resistance lines on improving risk appetite on the first trading day of the year in most markets.

Players remained reluctant to chase the regional units too aggressively, however, as they awaited fresh developments in Europe's debt crisis.

The Indian rupee rose on hopes for capital inflows after the government said on Sunday that individual foreign investors would be allowed to directly buy stocks from later this month. But the local currency still underperformed most of its Asian peers.

The Singapore dollar strengthened as investors were relieved by data showing the country's economy contracted just in line with market estimates.

Persistent worries about the euro zone's debt crisis forced investors to take profits from emerging Asian currencies rather than chasing them up further, dealers and analysts said.

Higher oil prices, with U.S. crude jumping to above $100 a barrel, are also expected to put pressure on the regional units as many countries in the region rely heavily on imported oil.

"The (emerging Asian currencies') outlook for Q1 remains negative as the euro zone fiscal crisis has not been solved and will come back to bite," said Dariusz Kowalczyk, senior economist and strategist for Asia ex-Japan at Credit Agricole CIB in Hong Kong.

He said the won, the Singapore dollar and the rupee are more vulnerable while the Chinese yuan would be a relative safe heaven among emerging Asian currencies.

Investors are keeping an eye on bond sales by key euro zone members.

Germany and France are set to issue bonds on Wednesday and Thursday, while Italy and Spain will start their 2012 funding next week.

Market players are particularly concerned about Italy's cost of funding in the face of around 100 billion euros of redemption and coupon payments in the first four months of the year.

SINGAPORE DOLLAR

U.S. dollar/Singapore dollar broke through the 61.8 percent Fibonacci retracement of 1.2903 as interbank speculators and short term leveraged accounts sold it. Investors were relieved that fourth-quarter GDP data was not worse then expected.

The economy contracted 4.9% in the fourth quarter of 2011 from the previous three months, roughly in line with economists' estimates. If the pair ends the day lower than the retracement, it may head to the 76.4 percent retracement of 1.2851.

WON

Offshore funds sold dollar/won, helping the pair break through a 20-day moving average of 1,151.7 and pushing it down to around the top of the daily Ichimoku cloud. Some local players also cleared long positions to stop losses.

But South Korean importers bought dollars for settlements. "Despite offers from some foreign names, I don't expect further falls from here. Importers bids are pretty strong for now," said a foreign bank dealer in Seoul.

But if the cloud's top is cleared, dollar/won is seen heading to 1,146.0, the 61.8 percent retracement of its rise in December.

RINGGIT

Dollar/ringgit broke through a 55-day moving average and the 61.8 percent Fibonacci retracement of its December rise. The pair breached the retracement of 3.1509 and the average of 3.1483. If it ends the day lower than those support levels, it may head to 3.1396, the 76.4 percent retracement. And the next level could be 3.1382, the 38.2 percent retracement of its rise between October and December.

PHILIPPINE PESO

Interbank speculators sold dollar/Philippine peso , but some players were looking to buy it on worries about the euro zone. "I think this should be a chance for people to buy USD. EU worries are still out there," says a European bank dealer in Manila.- Reuters

Gold, silver rally as new year rekindles risk appetite

2012-01-03T18:05:00.001+08:00

SINGAPORE (Jan 3): Gold rallied more than 1 percent and silver jumped over 2 percent on Tuesday as investors returned in the new year with a renewed appetite for riskier assets such as commodities, although global economic worries still weighed on sentiment.

Better-than-expected manufacturing data from China fuelled interest among investors who had moved to the sidelines because of year-end credit tightness. A weaker dollar also helped fuel gains in commodities.

"Everyone is a bit more optimistic at the beginning of the year," said Ong Yi Ling, an analyst at Phillip Futures. But Ong cautioned that the euphoria may not last long for gold as market sentiment remains fickle due to the shaky global economic outlook.

Gold could drop below $1,500 in the first quarter of 2012 and is unlikely to test its record high hit last September until later 2012, a Reuters poll showed.

Spot gold rose as much as 1.5 percent to $1,589.65 an ounce and eased slightly to $1,588.29 by 0724 GMT, rebounding from a 10-percent loss in December.

The most-active U.S. gold futures contract rallied 1.5 percent to $1,589.50. Technical analysis suggested spot gold could rise towards $1,629 an ounce during the day, said Reuters market analyst Wang Tao.

Iran's progress in its nuclear pursuit has gripped the oil market and could potentially support safe haven demand in gold. But for now, gold's move hinges on macroeconomic conditions and changes in risk appetite.

Investors await a raft of U.S. economic data this week, including ISM Manufacturing PMI later in the day, factory orders on Wednesday and non-farm payroll data on Friday, after recent data showed that the world's top economy was recovering.

SILVER LEADS GAINS IN PRECIOUS METALS

Cash silver gained 2.2 percent to $28.41, leading the rally in the precious metals complex. U.S. silver rose 1.8 percent to $28.41. The metal, with extensive industrial applications, lost nearly 10 percent in 2011 as worries about the global economy weakened prospects of industrial metals. "Silver is one of the more appealling trades of the new year, after a lot of positions have been emptied out," said a Singapore-based trader.

"Now the turn of the year has happened and we will probably see silver back on radar screens for some accounts, especially those with healthy tolerance for risk."

Managed money cut net length on U.S. silver futures and options to 6,200 lots in the week ended Dec. 27, its lowest in more than three years, according to data from the U.S. Commodity Futures Trading Commission.- Reuters

Tricubes's 70% subsidiary gets RM6m police contract

2012-01-03T17:05:00.005+08:00

KUALA LUMPUR (Jan 3): TRICUBES BHD []'s subsidiary has secured a RM6 million contract from the Home Ministry to provide the maintenance services for two mobile management systems used by the police.

It said on Tuesday its 70% owned TricubesNCR JV Sdn Bhd had accepted the letter of award for the maintenance of the hardware and software and server enhanced mobile management system and mobile card acceptance device.

'The award is valued at RM6 million for a period of two years commencing from Jan 1, 2012 to Dec 31, 2013,' it said.

The group incurred loss from operation of RM719,290 and the company incurred a net loss of RM3.13 million respectively for financial year ended March 31, 2011. As of that date, the group's accumulated losses amounted to RM17.24 million.

Nilai Resources gets RM27m price reduction from major shareholder

2012-01-03T17:05:00.003+08:00

KUALA LUMPUR (Jan 3): Nilai Resources Group Bhd's subsidiary has received a RM27.36 million discount on the purchase price of LK Prisma Sdn Bhd by Lapangan Kota Sdn Bhd.

Nilai Resources said on Tuesday its subsidiary BBN Development Sdn Bhd had on Dec 31, 2011 received a revised letter of offer from Lapangan Kota to sell the company for RM91.08 million.

The previous price tag of RM118.41 million was announced on Nov 16.

Lapangan Kota is majority owned and controlled by Nilai Resources shareholder Datuk Dr Gan Kong.

Lapangan Kota owns 418.20 acres of land, which is part of the Seremban Utara township development. The land was approved for either residential, commercial, institution or industry use.

KLCI extends losses, Maybank leads losers among banks

2012-01-03T17:05:00.001+08:00

KUALA LUMPUR (Jan 3): Banks were the major losers on Tuesday as profit taking almost erased the gains from last Friday's window-dressing activities by local funds. However, the overall market sentiment was mixed.

At 3.25pm, the FBM KLCI was down 16.05 points to 1,514.68. Turnover was 1.10 billion shares valued at RM884.54 million. There were 361 gainers, 340 losers and 284 stocks unchanged.

Maybank fell the most among banking stocks, down 24 sen to RM8.34 with 3.15 million shares done, Public Bank gave up 22 sen to RM13.16 and CIMB'' 21 sen to RM7.23 while RHB Cap shed 19 sen to RM7.29.

OSK Equities Research said for December, as expected, the market rallied with a particularly strong run at the last minute to bring it within 3.0 points of its 1,533 2011 year-end target

'As we have said in our 2012 market outlook strategy piece, above 1,500, we will call a SELL and so we call a SELL now on the market. Our 2012 KLCI fair value of 1,466 remains intact (mid-year target),' it said.

Media Chinese Intl director sells 400,000 shares

2012-01-03T16:04:00.003+08:00

KUALA LUMPUR (Jan 3): MEDIA CHINESE INTERNATIONAL LT []d director Tiong Kiew Chiong disposed of 400,000 shares in the open market on Dec 30.

A filing to Bursa Malaysia on Tuesday showed he disposed of the shares, representing 0.03%, for RM1.19 a share.

After the disposal of the stake, Tiong's stake was reduced to 3.607 million shares.

Maxbiz gets letter of intent for FTTX infrastructure works worth RM510m

2012-01-03T16:04:00.001+08:00

KUALA LUMPUR (Jan 3): MAXBIZ CORPORATION BHD [] has received a letter of intent (LOI) in respect of a fibre-to-the-home and fibre-to-the-office (FTTX) contract worth RM510 million.

The company said on Tuesday that it had received the LOI from Fiber-N Sdn Bhd on Dec 30, 2011 for the infrastructure works for 100,000 FTTX connections on high rise residential and office buildings in Klang Valley, Penang and Johor Bahru.

Meanwhile, the company also said its unit Dutamas SME had received a letter of award for infrastructure works for a project in Ipoh worth RM4.94 million from Harta Mesra Development Sdn Bhd.

It said the contracts were expected to contribute positively to its earnings for the financial year ending Dec 31, 2012.

Mild profit taking keeps KLCI in the red at mid-day

2012-01-03T15:04:00.001+08:00

KUALA LUMPUR (Jan 3): The FBM KLCI remained in negative territory at the mid-day break on Tuesday, as mild profit taking and losses at banking stocks weighed on the index.

The FBM KLCI fell 12.88 points to 1,517.85 at the mid-day break, bucking the trend at key regional markets.

Gainers led losers by 330 to 293, while 276 counters traded unchanged. Volume was 818.82 million shares valued at RM584.83 million.

The ringgit strengthened 0.61% to 3.1498 versus the US dollar; crude palm oil futures for the third month delivery rose RM50 per tonne to RM3,220, crude oil gained US$1.44 per barrel to US$100.27 while gold jumped US$14.68 an ounce to US$1,580.95.

At the regional markets, Hong Kong's Hang Seng Index jumped 2.05% to 18,812.69, South Korea's Kospi was up 2.43% to 1,870.70, Taiwan's Taiex added 1.68% to 7,068.94 and Singapore's Straits Times Index rose 1.25% to 2,679.49.

The China and Japan markets are closed today for holidays.

On Bursa Malaysia, BAT was the top loser this morning and fell 50 sen to RM49.42; Petronas Dagangan fell 30 sen to RM17.50, Petronas Gas down 20 sen to RM15, Tahps 18 sen to RM4.10, PPB 16 sen to RM17 and JT International down 15 sen to RM7.24.

Among the banks, Public Bank fell 22 sen to RM13.16, CIMB and Maybank down 20 sen each to RM7.24 and RM8.38, RHB Capital lost 14 sen to RM7.34, AMMB 11 sen to RM5.84, Hong Leong Bank fell four sen to RM10.86 and Affin was down three sen to RM3.05.

PLANTATION [] stocks advanced after RHB Research maintained its Outperform call on the sector and said CPO prices could rise above expectations.

'Recently, several developments have led us to believe that the risk of CPO prices rising above market expectations is increasing, particularly in 1H2012, including: 1) The weather is now officially in La Ni''a territory; 2) Impact of La Ni''a on soybean supply is a high risk factor; 3) Any crop losses would have knock-on effects on CPO demand and prices; 4) Rising crude oil price and its close correlation with CPO prices; and 5) Continued narrowing of the price discount between CPO and other competing vegetable oils,' it said in a note Jan 3.

Among plantation counters, KLK rose 20 sen to RM22.90, United Plantations and Kulim 18 sen each to RM19.18 and RM4.40, Tradewinds Plantations 16 sen to RM4.50 and Batu Kawan eight sen to RM17.54.

Other gainers included IGB that rose 22 sen to RM2.68, Genting 20 sen to RM11.20, Aeon, LPI Capital and BHIC 16 sen each to RM7.40, RM13.68 and RM3.59, while Supermax was up 14 sen to RM3.97.

The actives included Hibiscus, JCY, MAS warrants, XDL, IRCB, Time and Proton.

#Flash* LBS Bina targets RM1 bln annual property sales target

2012-01-03T14:04:00.005+08:00

KUALA LUMPUR (Jan 3): LBS BINA GROUP BHD [] is targeting RM1 billion annual'' property sales target in the near term as the company focuses on the various segments of the residential market apart from commercial and industrial PROPERTIES [].

Managing director Datuk Lim Hock San said on Tuesday that LBS was expected to achieve property sales of RM800 million and RM950 million in the financial years ending Dec 2012 and 2013 respectively.

"As such, we are confident" Lim told reporters after the EGM.

He also indicated that LBS might venture into Sabah and Sarawak, but this would hinge on the feasibility of the property development projects.

Lim said the firm had been approached to undertake projects in Sabah. He declined to elaborate.

Singapore Q4 GDP shrinks, recession looms

2012-01-03T14:04:00.003+08:00

SINGAPORE, Jan 3 (Reuters) - Singapore's trade-driven economy contracted in the last three months of 2011, signalling it may slip into a technical recession as a slump in manufacturing output and slowdown in external demand hurt exports.

The contraction, however, is unlikely to bring about a change in monetary policy which leans towards a gradual and modest appreciation of the Singapore dollar, most economists said.

Advance estimates showed gross domestic product (GDP) fell 4.9 percent in the fourth quarter compared with the July-September period on a seasonally adjusted, annualised rate. Manufacturing output plunged 21.7 percent quarter-on-quarter, the trade ministry said on Tuesday.

"The case for further MAS (Monetary Authority of Singapore) easing in April is less clear cut than in past recessions," said Citigroup economist Kit Wei Zheng, noting inflation remains elevated while the slide in GDP is relatively modest compared to past recessions.

The Southeast Asian country, whose trade is about three times its GDP, is considered a regional bellwether because of its small domestic economy and dependence on global trade and investment.

Singapore reported higher-than-expected inflation figures for November even as industrial production fell, putting pressure on the government to announce new measures to contain prices and keep costs down.

Citigroup's Kit said the government may choose to support the economy by helping businesses keep costs down when it unveils its budget in February.

"But the scale of fiscal stimulus is likely to be modest, as the government may want to conserve fiscal bullets in the first year of its term, or for the contingency that the recession deepens," he said.

Singapore manages monetary policy by targeting the value of its dollar against an unnamed basket of currencies.

In October, MAS retained its bias for a modest appreciation of the Singapore dollar, but said it would reduce the pace of increase.

CHANCES OF A RECESSION

Singapore narrowly averted a technical recession in the third quarter, largely because of a surge in biomedical production.

Most analysts expect the economy to continue contracting in the first quarter of 2012, resulting in a technical recession which is defined as two consecutive quarters of negative GDP.

"The outlook for 2012 remains cautious given Europe's debt crisis, China's slowdown and uncertainty over U.S. tax measures," Bank of America Merrill Lynch economist Chua Hak Bin said in a note to clients.

"(Our) model shows a slightly higher than even chance of a recession in first quarter 2012," he added.

Singapore exports most of what it manufactures to major destinations such as Europe, the United States, Japan and China, among others.

Electronics makes up for 31 percent of its manufacturing sector, which in turn accounts for about one-quarter of its GDP.

The city-state's economy grew 1.5 percent in the third quarter on a seasonally adjusted and annualised quarter-on-quarter rate, following a contraction of 5.9 percent in April-June.

During the third quarter of 2011, rival Asian business and financial centre Hong Kong also narrowly averted a recession with quarterly growth of just 0.1 percent.

Singapore's GDP expanded 3.6 percent in the fourth quarter from a year ago, slowing from the 5.9 percent expansion in the third quarter.

The fourth quarter data was in line with economists' estimates only because GDP numbers for the first nine months were revised down.

On Tuesday, Singapore said private home prices edged up by 0.2 percent in the fourth quarter from the third -- the smallest increase since the property market began rallying two years ago.

Prime Minister Lee Hsien Loong warned in his New Year's Day message that Europe's debt problems were "far from solved", and Singapore faced an uncertain external evironment with growth expected at a much slower 1-3 percent in 2012.

DBS economist Irvin Seah said the next six months will be challenging for Singapore, especially for the manufacturing sector. "Asia itself is also slowing... As such, we foresee a weak first half followed by a gradual pick-up in growth momentum in the second half of 2012," he added.

Bursa Malaysia eases entry rules for derivatives trading

2012-01-03T14:04:00.001+08:00

KUALA LUMPUR (Jan 3): Bursa Malaysia Derivatives is offering a two-day programme as it relaxes the entry rules for derivatives trading.

The stock exchange said on Tuesday the examination, academic and experience pre-requisites have been removed.

'Individuals who aspire to be professional derivatives traders or local participants can now do so by attending a two-day familiarisation programme with Bursa Malaysia Derivatives,' it said.

Under the classification, a local participant is a professional derivatives trader who trades their own account, or is a self-employed trader.

With the easing of entry requirement, candidates no longer need to take the licensing examination, or show the relevant academic qualification and industry experience.

'This is part of the exchange's initiatives to increase the number of local participants in the market,' it said.

Local participants can trade with their own funds and are not permitted to conduct trades on behalf of clients.

RHB Research maintains underperform on VS Industry

2012-01-03T11:33:00.007+08:00

KUALA LUMPUR (Jan 3): RHB Research Institute is maintaining its Underweight on VS Industry and its fair value estimate of RM1.40 a share based on 6.0 times CY12 remains unchanged.

It said on Tuesday the 1QFY07/12 core net profit of RM9.6 million was within expectations. The 1Q revenue increased by 7.5% on-quarter on orders from new volume sales for Itron and Epson.

However, the first quarter earnings before interest and taxation (EBIT), more than doubled on-quarter as EBIT margin expanded by 2.8 percentage points from operating leverage effects on higher utilisation rates.

'Coupled with lower share of associate losses, core net profit grew 29.1% on-quarter. Separately, VSI declared an interim single-tier DPS of 5.0 sen,' it said.

RHB Research said it believes the near-term outlook remains challenging stemming from weaker consumer spending amidst the macroeconomic headwinds.

'However, we believe the new contribution of Keurig (coffee brewers) should partly mitigate weaker sales from existing customers (i.e. NextWindow and Dyson). Furthermore, in the longer term, we believe VSI could benefit from rising demand for outsourcing manufacturing capabilities,' it said.

Proton continues to remain in limelight

2012-01-03T11:33:00.005+08:00

KUALA LUMPUR (Jan 3): PROTON HOLDINGS BHD [] continued to remain in the limelight and on investors' radar into the new year, following a report by the Edge weekly that General Motors (GM) is eyeing a stake in the national carmaker's Tanjung Malim plant.

At 9.30am, Proton added six sen to RM4.88 with 732,600 shares traded.

The Edge weekly in its latest edition reported that Proton's top management was said to be in talks with the Detroit-based GM to sell up to a 50% stake in its Tanjung Malim plant.

Citing sources, the Edge said that GM could buy a 40% to 50% stake in the plant for between RM700 million to RM800 million.

For more, read the latest edition of the Edge weekly.

OSK Research advises investors to remain defensive, sell above 1,500

2012-01-03T11:33:00.003+08:00

KUALA LUMPUR (Jan 3): OSK Research said its expectation of a December rally proved correct as the FBM KLCI raced up in the final trading week of 2011 to end at 1530.73, less than 3.0 points shy of its 2011 year-end target.

'We stand by our earlier strategy that investors should 'Remain Defensive, Sell when KLCI breaks above 1500, and Buy as the index approaches 1300', it said.

OSK Research said it has a Sell call on the market for January. It viewed the KLCI as overpriced and lacking fundamentals to sustain at this level.

'With three of our five Top December buys having outperformed the KLCI, we are switching to the more unconventional small cap buys for January given our broader market Sell call,' it said.

Banks, blue chips weigh KLCI down at mid-morning

2012-01-03T11:33:00.001+08:00

KUALA LUMPUR (Jan 3): The FBM KLCI bucked the regional trend and retreated on the first trading day of 2012, and slipped 8.62 points to 1,522.11 at mid-morning, weighed by banking and select blue chip stocks.

Gainers led losers by 223 to 160, while 212 counters traded unchanged. Volume was 325.47 million shares valued at RM182.34 million.

At the regional markets, Hong Kong's Hang Seng Index jumped 1.7% to 18,747.83, South Korea's Kospi rose 1.97% to 1,862.38, Taiwan's Taiex added 1.4% to 7,049.28 while Singapore's Straits Times Index gained 0.62% to 2,662.78.

The China and Japan markets are closed today for holidays.

OSK Research director Chris Eng in his January outlook report said the research house's expectation of a December rally proved correct as the FBM KLCI raced up in the final trading week of 2011 to end at 1530.73 points, less than 3 points shy of its 2011 year-end target.

'We stand by our earlier strategy that investors should 'Remain Defensive, Sell' when KLCI breaks above 1,500 pts, and Buy as the index approaches 1,300 points'.

'As such, we have a Sell call on the market for January,' he said.

Eng said the KLCI was overpriced and lacking fundamentals to sustain at this level.

'With 3 of our 5 Top Dec buys having outperformed the KLCI, we are switching to the more unconventional small cap buys for January given our broader market Sell call.

Among the decliners at mid-morning, Public Bank fell 22 sen to RM13.16, CIMB 17 sen to RM7.27, while Maybank and RHB Capital lost 13 sen each to RM8.45 and RM7.35.

Other losers included Nestle that fell 20 sen to RM56, BAT 16 sen to RM49.76, KrisAssets 15 sen to RM6.10, Batu Kawan 14 sen to RM17.32, while Ewein and Lafarge Malayan Cement fell 10 sen each to 80 sen and RM6.90.

Allianz led the gainers and was up 60 sen to RM5.35; United PLANTATION []s gained 20 sen to RM19.20, Aeon 16 sen to RM7.40, Hibiscus 12.5 sen to RM1.07, Proton 12 sen to RM4.94, Supermax and Tradewinds Plantations 11 sen each to RM3.94 and RM4.45, while MAHB, Malayan Flour Mills and KLK added 10 sen each to RM5.90, RM7.30 and RM22.80 respectively.

The actives included Hibiscus, JCY, IRCB, Proton, Sanichi and TMS.

MIDF Research remains Neutral on banking sector

2012-01-03T10:33:00.009+08:00

KUALA LUMPUR (Jan 3): MIDF Research remains Neutral on the banking sector as it expects net profit of banks next year to be moderated by slower economic growth.

The research house said on Tuesday that although the Nov 2011 statistics showed an increase in growth rate of loan applications, the stronger growth rate was attributed to the effect of a lower base of loan applications in Nov 2010 which was lower by 6.7% compared to Oct 2010.

MIDF Research said it expects banks to be prudent and conservative in terms of capital management in light of the Basel III requirements especially for requirement for potential capital buffer even though as of now, all banks appeared to be comfortable in meeting the higher capital ratio requirements of Basel III.

'Our BUY calls on RHB CAP (TP: RM9.20) and AFG (TP: RM4.10) remained unchanged as of now. We have adjusted our TP for AFG to RM4.10 from RM3.84 previously based on 1.6x PBVR on FY13 BVPS.

'We are still NEUTRAL on AMBANK (TP: RM6.03), HONG LEONG BANK (TP: RM10.50), CIMB (TP: RM7.50), MAYBANK (TP: RM8.80) and PUBLIC BANK (TP: RM13.00),' it said.

''

CIMB Research has technical buy on Rimbunan Sawit at 92.5 sen

2012-01-03T10:33:00.007+08:00

KUALA LUMPUR (Jan 3): CIMB Equities Research has a technical buy on Rimbunan Sawit at 92.5 sen at which it is trading at a price-to-book value of 0.8 times.

It said on Tuesday the share price of the PLANTATION [] company broke out of its consolidation triangle pattern on Friday.

'We think the stock is ripe for a stronger rebound. If we are right, there is a good chance that prices may charge towards 95.5 sen over the next few days. The following resistance levels are RM1.00 and RM1.04,' it said.

CIMB Research said the technical landscape remains conducive. MACD signal line is poised for a positive crossover while RSI has begun to hook upward. The 30-day SMA (now at RM0.88) could also offer some support to prices.

'Aggressive traders may start to nibble now. However, always place a stop at between 90.5 sen to 87 sen. A break below 83 sen would indicate that the uptrend from its April 2011 low is likely over,' it said.

HDBSVR expects KLCI to stage pullback after late surge on Friday

2012-01-03T10:33:00.005+08:00

KUALA LUMPUR (Jan 3): Hwang DBS Vickers Research expects the key FBM KLCI to gap down when trading kicks off on Tuesday morning.

It said the benchmark index could pull back towards the immediate resistance-turned-support level of 1,515 on the chart. This follows its spurt in the last 15-20 minutes of trading on the last trading day of 2011, presumably attributable to window-dressing activities.

In addition, the few stock exchanges that were opened for trading yesterday saw mixed closings, with Taiwan (-1.7%) and Indonesia (-0.3%) on the losing side while the Philippines (+0.6%) and India (+0.4%) chalked up marginal gains.

Locally, stocks that may be in the limelight today include: (a) Proton, in response to a business weekly report saying that the national automaker is in talks to sell up to 50% of its stake in its Tanjung Malim plant to General Motors for between RM700 million to RM800 million; and (b) glove manufacturers like Top Glove, Kossan Rubber and Hartalega, as demand for gloves may rise following the latest bird flu scare in China and Hong Kong.

KLCI opens lower on first trading day of 2012

2012-01-03T10:33:00.003+08:00

KUALA LUMPUR (Jan 3): The FBM KLCI opened lower on the first trading day of 2012, weighed down by banks and blue chips stocks.

The FBM KLCI fell 11.19 points to 1,519.54 at 9.10am.

Gainers led losers by 114 to 80, while 141 counters traded unchanged. Volume was 80.09 million shares valued at RM35.31 million.

Among the early decliners were Nestle, BAT, CIMB, Batu Kawan, Maybank, RHB Capital, F&N, IOI Corp, Axiata and Tenaga.

Maybank Investment Bank Bhd maintained its 2012 year-end KLCI target of 1,500 points based on one standard deviation below mean on expectation of turbulence still at the external markets impacting sentiment and global growth.

'At the domestic front, the country could return to the polls earlier with the 13th General Elections which may, in turn, lend to cautiousness.

'Our 7.7% KLCI earnings growth forecast for 2012 is unchanged premised on our 3.5-4% domestic GDP growth forecast,' it said in a note Jan 3.

RHB Research maintains overweight on plantations sector

2012-01-03T10:33:00.001+08:00

KUALA LUMPUR (Jan 3): RHB Research Institute is maintaining its Overweight on the PLANTATION []s sector, with five Outperform calls and three Market Perform calls.

It said on Tuesday that it has Outperform calls on Genting Plantations, Sime Darby, TH Plantations, First Resources and CBIP while the three Market Perform calls are IOI Corp, KLK and IJM Plantations.

'Our top picks remain upstream players like Genting Plantations and TH Plantations, as we believe the risks faced by the more integrated players are rising, due to the new disadvantageous Indonesian export tax structure,' it said.

RHB Research said recently, several developments have led it to believe that the risk of CPO prices rising above market expectations is increasing, particularly in 1H2012.

It said the weather is now officially in La Ni''a territory; 2) Impact of La Ni''a on soybean supply is a high risk factor; 3) Any crop losses would have knock-on effects on CPO demand and prices; 4) Rising crude oil price and its close correlation with CPO prices; and 5) Continued narrowing of the price discount between CPO and other competing vegetable oils.

'We maintain our CPO price assumptions of RM3,100 a tonne for CY12 and RM2,900/t for CY13. For CY11, our price projection remains unchanged at RM3,100 even though YTD average price is RM3,274. We are not revising our forecasts for 2011 to be conservative, as we believe most plantation companies would not necessarily be able to achieve prices so close to the spot price,' it said.

Euro wobbly ahead of event-packed U.S. week

2012-01-03T09:33:00.005+08:00

SYDNEY (Jan 3): The euro got off to a rocky start against major currencies on Tuesday, standing just above a decade trough on the yen in Asia and looked set to remain under pressure in 2012 from Europe's debt crisis.

The U.S. economy will be front and center this week - starting with ISM Manufacturing on Tuesday where an improvement to 53.2 is expected from November's reading of 52.7.

It will be followed by the release of the FOMC Minutes where investors will look for signs of another round of quantitative easing. But the main event for the week will be non-farm payroll data on Friday where analysts are hoping for a robust rise of 150,000.

The euro was at 99.42 yen, having slipped as deep as 98.71 overnight on the EBS trading platform, its lowest since late 2000, following breaks of major chart support from 100 yen.

The single currency also reached record lows on the Australian dollar. It was last at A$1.2633, having shed more than two cents in the past week, having broken through key levels between A$1.2900-A$1.3000. Technical charts point to further downside with a test of A$1.2500 in sight, according to a trader.

Against the U.S. dollar, the euro was steady at $1.2935 , but within striking distance of its 2011 trough of $1.2856 hit last week.

"{The euro) ended last year on a downtrend, breaking key levels. Through much of last year, people were surprised how well it held up," said Greg Gibbs, a strategist at RBS.

"Eventually it started to fall... and that will make the market more skeptical over it and hence it's probably going to look a bit soggy at the start of the year."

Worries about high sovereign debt levels and a lack of policy solutions to the region's 2-year-old debt crisis were expected to push the euro lower in the coming weeks and months.

A solution seems to remain distant with France's Nicolas Sarkozy due to meet German Chancellor Angela Merkel in Berlin on Jan. 9. Talks are likely to centre on new rules to enforce budget discipline across the European Union.

January starts a very busy quarter for eurozone issuance with Germany and France kicking off bond sales on Wednesday and Thursday, while Italy and Spain will begin their 2012 funding next week.

Investors are particularly concerned about Italy's cost of funding in the face of around 100 billion euros of redemption and coupon payments in the first four months of the year.

Sentiment, though, was helped by a rise in China's official PMI to 50.3 in December, from 49 in November. The stronger-than-expected reading combined with rising prospects of more monetary easing helped offset worries about a sharp slowdown.

China's central bank is in the spotlight with widespread speculation in financial markets that it will soon unveil a cut in the required ratio of reserves (RRR). The move would free up funds that could be used for lending to support growth, though China's leaders remain wary of relaxing their grip too soon on inflation.

The dollar index inched up 0.1 percent to 80.288, off a one-year peak of 80.854 struck on Thursday, while the USD was hovering around six-week lows against the yen at 76.96 in thin trading.

With the pair standing below the Ichimoku cloud, a move to the record low of 75.31 is possible, according to a trader. - Reuters

Seoul shares open higher; refiners lead

2012-01-03T09:33:00.003+08:00

SEOUL (Jan 3): Seoul shares opened up on Tuesday with a new year rally in European stocks lending support, but gains were seen capped on persistent euro zone debt uncertainties.

Rises were led by refiners, with SK Innovation up 2.49 percent and S-Oil climbing 1.49 percent.

The Korea Composite Stock Price Index (KOSPI was up 1.2 percent at 1,848.22 points as of 0001 GMT. - Reuters

GLOBAL MARKETS-Euro makes shaky start, oil spikes on Iran tension

2012-01-03T09:33:00.001+08:00

SINGAPORE (Jan 3): The euro languished near a decade low against the yen on Tuesday as the trading year began with no relief in sight for the European debt crisis, and U.S. crude jumped 1.5 percent to above $100 a barrel on escalating tensions between Iran and the West.

Asian shares rose, led by gains for the materials sector, with mining heavyweights BHP Billiton and Rio Tinto both up more than 1.5 percent.

MSCI's broadest index of Asia Pacific shares outside Japan rose 0.5 percent. Stock indexes in Australia and South Korea both rose more that 1 percent.

Japanese markets were closed for a holiday.

The euro bought around 99.50 yen, having fallen as low as 98.71 in the previous session, its lowest since late 2000.

Against the dollar, the euro was steady at $1.2935, but within striking distance of its 2011 trough of $1.2856 hit last week.

"(The euro) ended last year on a downtrend, breaking key levels. Through much of last year, people were surprised how well it held up," said Greg Gibbs, a strategist at RBS.

"Eventually it started to fall... and that will make the market more sceptical over it and hence it's probably going to look a bit soggy at the start of the year."

Oil rose after Iran said it had test-fired two long-range missiles, a display of military muscle flexing in the face of mounting Western pressure over its nuclear programme.

The move stoked fears of supply disruptions in the Strait of Hormuz, through which 40 percent of world oil is shipped, and pushed U.S. crude up 1.5 percent to around $100.35 a barrel. - Reuters

US STOCKS SNAPSHOT-Wall St jumps at open after Chinese, German data

2012-01-03T00:06:00.001+08:00

NEW YORK (Jan 3):'' U.S. stocks opened sharply higher on Tuesday as better-than-expected Chinese and German data boosted optimism about the global economy after the S&P 500 index ended flat in 2011.

The Dow Jones industrial average gained 201.17 points, or 1.65 percent, to 12,418.73. The Standard & Poor's 500 Index rose 22.01 points, or 1.75 percent, to 1,279.61. The Nasdaq Composite Index climbed 54.85 points, or 2.11 percent, to 2,660.00. - Reuters

#Stocks to watch:* Maybank, OSKVI, LBS Bina, Maxbiz

2012-01-03T00:06:00.000+08:00

KUALA LUMPUR (Jan 4): Stocks on Bursa Malaysia could open on a firmer note on Wednesday as sentiment would be underpinned by firmer external events.

Though the FBM KLCI closed down 1.12% or 17.19 points to 1,513.54 on Tuesday, weighed by losses at banking and key blue chips, the broader market was steadier with gainers leading losers by 446 to 325.

Wall Street opened higher as better-than-expected Chinese and German data boosted optimism about the global economy, according to Reuters.

Among the stocks which could see trading interest are MALAYAN BANKING BHD [], OSK VENTURES INTERNATIONAL BHD [] (OSKVI), LBS Bina Bhd and MAXBIZ CORPORATION BHD [].

Maybank has been given a further extension until June 1, 2012 to sell down its stake in PT Bank Internasional Indonesia Tbk (BII).

Maybank had received a letter, dated Dec 27, from Indonesia's Badan Pengawas Pasar Modal dan Lembaga Keuangan (Bapepam) where the latter had given it more time to undertake the corporate exercise. Maybank owns 97.5% of BII which it had acquired in 2008.

OSK HOLDINGS BHD [] director Ong Leong Huat @ Wong Joo Hwa has been buying shares of OSK Ventures International Bhd. He bought 930,000 shares on Dec 27 at 31 sen a piece and 600,000 shares the next day at an average price of 30.1 sen.

The recent acquisitions raised his direct shareholding in OSKVI to 25.86% or 50.62 million shares.

LBS BINA GROUP BHD [] is targeting RM1 billion annual ''property sales target in the near term as the company focuses on the various segments of the residential market apart from commercial and industrial PROPERTIES [].

Managing director Datuk Lim Hock San said LBS was expected to achieve property sales of RM800 million and RM 950 million in the financial year ending Dec 2012 and 2013 respectively.

Maxbiz has received a letter of intent (LOI) in respect of a fibre-to-the-home and fibre-to-the-office (FTTX) contract worth RM510 million.

The company had received the LOI from Fiber-N Sdn Bhd on Dec 30, 2011 for the infrastructure works for 100,000 FTTX connections on high rise residential and office buildings in Klang Valley, Penang and Johor Bahru.

ESTHETICS INTERNATIONAL GROUP [] Bhd's rights issue of 52.80 million new shares and 52.80 million free detachable warrants were undersubscribed by 28%.

Taiwan stocks start year with worst pct fall in 2 weeks

2012-01-02T16:04:00.001+08:00

TAIPEI (Jan 2):'' Taiwan stocks ended down 1.69 percent on the first trading day of the new year on Monday, weighed by heavyweights such as TSMC, with investors cautious ahead of the island's presidential election and with little guidance as most regional markets are closed.

The main TAIEX index shed 119.87 points to 6,952.21, its worst one-day percentage fall since Dec. 19 and extending the 21 percent fall for the whole of 2011.

Electronics slipped 1.47 percent, with the world's top contact chip maker TSMC 1.06 percent lower. The biggest losing sector was financials, down 2.96 percent.

"Trading will continue to be quiet and upside will be limited due to the uncertainty and risk associated with the outcome of the elections," said Tu Jin-lung, chairman of Grand Cathay Investment Advisory. "The best scenario before the vote is that the National Financial Stabilization Fund would support the market at the 7,000 point level."

The state fund, which has a mandate to stabilise markets during strong volatility, began stepping in last month as the benchmark index declined.

Taiwan holds presidential elections on Jan 14 in a vote that will determine whether the island deepens economic integration with mainland China or embarks on a period of more tense and possibly fractious cross-Strait relations.

The Taiwan dollar weakened slightly to trade at T$30.326. Foreign investors were net buyers on Friday, bringing their total buying to T$39.38 billion in December.- Reuters

Ex-Bursa Saham president dies of cancer

2012-01-02T15:04:00.001+08:00

KUALA LUMPUR (Jan 2): Former Bursa Saham Kuala Lumpur (now Bursa Malaysia) president Datuk Mohd Salleh Abdul Majid died today of rectal cancer and renal failure, a family member said. He was 62.

Salleh died at 10.20am at the Kuala Lumpur Hospital, he said.

Close family members were at his bedside when he breathed last.

The family member said Salleh's remains will be brought to his mother's house at Lot 1055, Jalan Haji Mokhtar, Kampung Pasir, Hulu Kelang, here.

The burial is expected to take place after Asar prayers.

Salleh was appointed Bursa Saham president in 1996 and retired in 2003. - Bernama

US consumer in slow lane

2012-01-02T13:33:00.001+08:00

NEW YORK (Jan 1): It's up to the consumer to drive the U.S. economy and lift world growth in 2012, and the outlook is far from encouraging.

Over the past three and half years, growth in U.S. consumer spending has averaged a paltry 0.2 percent adjusted for inflation, the weakest in the post-World War II period, Morgan Stanley says.

While the employment picture is gradually brightening, wage growth is going in the opposite direction, keeping a lid on consumer behavior. Over the past year, pay for blue-collar workers adjusted for inflation fell 12 cents from the previous year, according to the Bureau of Labor Statistics. That was the steepest decline since the stagflationary days of 1980.

Pay for all workers has fallen 16 cents this year in real terms.

Consumer buying power, modest over the holiday season, remains constrained by heavy debt loads. Total U.S. household debt as a percentage of disposable personal income is down from its 2007 peak at 130 percent, but it remains well above its 1970-2000 average of 75 percent.

As a result, Stephen Roach, non-executive chairman of Morgan Stanley, sees U.S. consumption remaining anemic for years to come. That will place a drag on global growth, especially in Asia, a big manufacturer of U.S. consumer goods.

"With retrenchment and balance-sheet repair only in its early stages, the zombie-like behavior of American consumers should persist," Roach said.

Consumer spending rose 1.7 percent in the third quarter, far below the 3.6 percent it averaged in the decade before the 2007-2008 recession. So it is hard to see world growth accelerating significantly until the U.S. consumer, who drives over 70 percent of U.S. GDP growth, revives.

There are other factors holding Americans' spending in check. The Federal Reserve last week reported early signs of tightening credit conditions, and government stimulus spending dries up this year. At the same time, uncertainty persists over the payroll tax cut and jobless benefits, which currently add 0.50-0.75 percentage point to GDP but are set to expire in February.

On top of that, businesses are pulling back on capital expenditure as tax breaks expire, while exports wane as a growth driver amid the upheavals from Europe. Most economists expect at best only modest U.S. economic growth around 2 percent in 2012 despite a recent batch of encouraging data.

"The year ahead is fraught with risks," said Tom Porcelli at RBC Capital Markets. "In fact, consumer fundamentals are decidedly weaker than this time last year."

If the U.S. employment report, due on Friday, shows marked improvement, it would lift optimism. But most economists expect only gradual gains of 150,000 new jobs added in December, up from 120,000 the prior month.

Although the average pace of job growth has nearly doubled over the past three months compared with the prior period, it remains well below the 200,000-250,000 mark viewed as healthy labor market conditions.

Wages may rise too. They are forecast to have climbed 0.2 percent in December after a drop in November. But buying intentions remain weak. The Conference Board reported in its U.S. consumer confidence survey for December that even though overall sentiment has improved, those in the market for big-ticket items like cars or houses mostly plan to buy used, not new -- a sign of extremely cautious attitudes.

That would explain why analysts forecast no acceleration in new car and truck sales data for the United States, due on Wednesday. They are seen holding steady at a 13.6 million annualized rate in December. Likewise, the ISM manufacturing index is expected to have ticked up only a slightly, to 53.2 from 52.7 in November.

"Still muddling through," is how Macroeconomic Advisers summarized the economic outlook for 2012.

A recent growth spurt might have given the U.S. economy some resiliency to withstand a euro-zone recession, weakening stock prices, rising credit costs, fiscal drag and a higher dollar. But the United States, and with it the world economy, remain vulnerable to shocks in the year ahead. - rEUTERS

Hyundai Heavy targets 20 pct order growth in 2012 to US$31 bln

2012-01-02T12:33:00.003+08:00

SEOUL (Jan 2): South Korea's Hyundai Heavy Industries, the world's biggest shipbuilder, said on Monday order growth was expected to more than halve to 20 percent this year as a sputtering global economy threatens to reduce seaborne trade.

The conservative outlook adds to recent order cancellations in the global shipbuilding sector as economic turmoil and tighter bank lending have compounded growing earnings pain for ship owners.

Hyundai, which also makes marine engines and CONSTRUCTION [] equipment, aims to win $30.6 billion in orders and earn 27.6 trillion won ($24 billion) in revenue this year, the company said in a filing to the stock exchange.

A Hyundai spokesman said 2012 order book growth would slow to 20 percent after rising 48 percent in 2011 to $25.5 billion.

Separately smaller rival STX Corp said it aimed to raise orders by 43 percent to 43 trillion won and sales by 14 percent to 33 trillion won this year.

In 2011, the shipbuilder to ship operator sought to raise its order book by 30 percent but growth came in flat due to worsening conditions in the seaborne sector. ($1 = 1152.0000 won) - Reuters

S.Korea manufacturing shrinks most in 3 yrs

2012-01-02T12:33:00.001+08:00

SEOUL (Jan 2): South Korea's manufacturing sector shrank the most in nearly three years in December as global demand cooled, a survey showed on Monday, but President Lee Myung-bak cited inflation as a bigger risk in a year of big elections.

Lee admitted in a televised new year speech that the global economy has entered a period of prolonged low growth but said fighting rising prices was still his top policy priority as the poor suffer from high living costs.

"The waves (of economic difficulty) will likely be much higher this year. The global economy is not in a temporary slump but has entered a new era of low growth," Lee said, adding the government would bring down inflation close to 3 percent.

Investors shrugged off Lee's comments as they thought developments in the euro zone's fiscal crisis would continue to dominate global as well as local markets well into the new year.

South Korea's inflation jumped to 4.0 percent in 2011 on an annual average basis, touching the second highest in 10 years, from 3.0 percent in 2010 on high commodities prices and price rises following the fast economic recovery since late 2009.

The popularity of Lee's conservative Grand National Party is falling amid a public outcry over the widening wealth divide, high prices and disappointing job growth.

The country is due to hold two nationwide elections this year.

Lee will step down at the end of his five-year term in early 2013 and is barred by the constitution from running for a second term.

The comments came as the HSBC/Markit survey showed the purchasing managers' index (PMI) on South Korea's manufacturing sector fell to a seasonally adjusted 46.40 in December from 47.12 in November, hitting the lowest level since February 2009.

It was the fifth month in a row that the index stayed below 50 demarcating expansion from contraction in manufacturing activity, the longest such losing streak since February 2009.

"A sharper drop in manufacturing activity over December confirms that Korea's economy is losing steam, with employment contracting over the month for the first time in almost three years," HSBC economist Ronald Man said in a statement.

He was referring to the first fall below 50 of the sub-index on employment in the manufacturing sector since February 2009, when the world was recovering from the shock of the worst economic crisis in decades.

The sub-index on employment fell to a seasonally adjusted 49.37 in December from 50.50 in November.

Similar manufacturing reports showed activity continued to contract in December in other parts of Asia as well, with China's factories struggling and Taiwan's PMI falling for a seventh straight month, even as the U.S. economy shows signs of gaining momentum.

The sub-index on new export orders received by South Korean manufacturers fell to a seasonally adjusted 45.96 in December, the lowest since early 2009 and also coming below the 50-point mark for a fifth consecutive month.

"In turn, policy makers should act pre-emptively to support the economy, and we expect the Bank of Korea to deliver a 25 basis-point cut in the first quarter of 2012," said Man, referring to the central bank's interest rate policy.

The Bank of Korea downgraded its outlook for Asia's fourth-largest economy in December but maintained its policy priority on fighting inflation, although analysts are increasingly predicting a rate cut later this year. - Reuters

India lets foreign individuals invest in stock market

2012-01-01T19:04:00.001+08:00

NEW DELHI (Jan 1): India will allow individual foreign investors direct access to its stock market from Jan. 15, the government said on Sunday, the latest step to liberalise Asia's third-largest economy after a year of big losses on the benchmark Sensex index.

Previously, foreign nationals were limited to investing in India's equity market through indirect routes such as mutual funds, or through institutional vehicles.

"The central government has decided to allow qualified foreign investors to directly invest in (the) Indian equity market in order to widen the class of investors, attract more foreign funds, and reduce market volatility," the government said in a statement.

In the past 20 years India has gradually opened its economy to foreign cash. The economy is now faltering after growing at an annual average of about 8 percent for several years.

The rupee shed 24 percent of its value against the dollar last year and the current account deficit is widening.

Many economists predict growth below seven percent for the fiscal year that ends on March 30.

Indian shares posted their first annual fall in three years in 2011 as a combination of near double-digit inflation, high interest rates, slowing domestic growth and policy inaction turned off investors already shaken by global headwinds.

Foreign fund inflows, a major driver of Indian stocks, dried up with net outflows of about $380 million as of Wednesday, a far cry from record inflows of more than $29 billion in 2010 that had powered a 17 percent rise in the benchmark index, following an 81 percent surge in 2009. - Reuters

#Stocks to watch:* MAS, Boustead, Cypark, SMR, VS Industry

2012-01-01T16:04:00.001+08:00

KUALA LUMPUR (Jan 1): The local stock market could see some profit taking in the first week of the trading year day after the recent run-up and last-minute window dressing activities. The rally was underpinned by local funds and pushed the FBM KLCI into positive territory for 2011.

The 30-stock index rallied more than 45 points over a seven-day trading period to end 2011 at 1,530.7. Total market capitalisation increased by RM11.38 billion over the same period to end the trading year at RM1,284.55 billion.

Among the stocks which could see trading interest following corporate developments include MALAYSIAN AIRLINE SYSTEM BHD [] (MAS), Boustead Holding Bhd, environmental TECHNOLOGY [] and engineering specialist CypARK RESOURCES BHD [], SMR TECHNOLOGIES BHD [], VS Industry Bhd and SILVER BIRD GROUP BHD [].

Last Friday, MAS unveiled its new management structure which included several new business units, the entry of two senior aviation experts and the departure of several top officials.

Focus would be on MAS' long-haul business, with its group chief executive officer Ahmad Jauhari Yahya taking on the role as CEO of long-haul. His deputy, Mohammed Rashdan, who is CEO of short-haul, would head the short-haul, group finance, aircraft finance & management, and in the interim helm commercial.

BOUSTEAD HOLDINGS BHD []'s 51% owned MHS Aviation Bhd is acquiring 16 aircraft for RM586.20 million from DRIR Equities Sdn Bhd. DRIR owns the other 49% of MHS.

Cypark's earnings fell 21.5% to RM4.11 million in the fourth quarter ended Oct 31, 2011 from RM5.24 million a year ago due to lower profit margins than the previous quarter. Gross profit margin was 25%, a decline from the 36% a year ago when it benefited from design income fee and good material rate negotiated in the quarter.

SMR's unit SMR HR Group Sdn Bhd has secured a RM14 million contract from the Human Resources Ministry. The one-year contract is to implement a trainining programme known as Accelerated Skills Enhancement Training Programme (ASET).

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VS Industry Bhd's earnings fell 10.9% to RM11.59 million in the firstquarter ended Oct 31, 2011 from RM13.01 million a year ago due to stiffer competition and losses from its China associate. Its revenue increased 14.1% to RM282.43 million from RM247.39 million while earnings per share were 6.39 sen compared with 7.27 sen.

Silver Bird called off its proposed placement exercise and a subscription commitment of up to RM100 million with GEM Global Yield Fund. It had to abort the proposals as Bursa Malaysia Securities Bhd rejected its waiver from complying with all the requirements to undertake back-to-back placements.

Malaysian Rating Corp Bhd (MARC) lowered its rating on MNRB Holdings Bhd's (MNRB) RM200 million Islamic medium term notes (IMTNs) to A+IS from AA-IS after the reinsurer suffered two consecutive years of losses and thin cash flow coverage measures.

The ratings agency said while the outlook for the debt notes was stable, the downgrading reflected weakened holding company level financial metrics after losses for FY ended March 31, 2010 (FY2010) and FY2011.

JAKS Resources Bhd posted net losses of RM25.13 million in the fourth quarter ended Oct 31, 2011 from a net profit of RM1.19 million a year ago due to goodwill impairment adjustment of RM25.90 million.

Its revenue rose 9% to RM93.24 million from RM85.74 million mainly due to higher revenue recognition of works done for projects in the CONSTRUCTION [] division. Loss per share was 5.73 sen compared with earnings per share of 0.27 sen.

For the financial year ended Oct 31, 2011, it swung into net losses of RM22.89 million compared net profit of RM2.28 million in the previous financial year.

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China stock regulator says no help for market

2011-12-31T18:04:00.001+08:00

BEIJING (Dec 31): The government does not plan to offer help to China's stock market, whose main index lost one-fifth of its value in 2011, and investors should instead have faith in market forces, the country's stocks regulator was quoted as saying on Saturday.

The benchmark Shanghai Composite Index ended the year down 21.7 percent, its worst annual performance since the global financial crisis in 2008, amid evidence that Chinese factory activity continues to shrink.

But newly appointed China Securities Regulatory Commission Chairman Guo Shuqing said he has no plans to ride to the rescue, the official Shanghai Securities News reported.

"There is no such concept as rescuing the markets; the markets have their own operating rules," the newspaper quoted Guo as saying.

People should have faith in the "superb" companies which underpin the Chinese economy. "We're confident because we have a number of strong enterprises in the real economy," Guo said.

Some have already listed, while others will join them gradually, he added. "So everyone should have confidence in the market."

China's factory activity shrank again in December as demand at home and abroad slackened, a purchasing managers' survey showed, reinforcing the case for pro-growth policies from Beijing to underpin the world's second-largest economy.

Earlier this month, Chinese leaders pledged to keep monetary policy "prudent" and fiscal policy "pro-active" to stabilise economic growth while keeping inflation under control. .

Some analysts and brokerage houses, including Guotai Junan Securities, are now cautiously optimistic for stocks after China ended a monetary policy tightening cycle in November by cutting banks' required reserve ratios.

Guotai Junan expects China's stock market to hit a low in the first quarter of next year followed by a rebound. - Reuters