TSM off early high on bonus plan

KUALA LUMPUR: TSM GLOBAL BHD [] surged to a high of RM4.20 in the morning session on Monday, Nov 1 after it proposed a one-for-one bonus issue.

At 11.53am, it was up five sen to RM3.98. There were 323,300 shares done at prices ranging from RM3.95 to RM4.20.

Last Friday, the electrical products supplier proposed to undertake the bonus issue of up to 63.69 million new shares on a one-for-one bonus issue.

FBM KLCI continues to hover at 1,500 level

KUALA LUMPUR: Banking and PLANTATION [] heavyweights continued to extend their gains in mid-morning trade on Monday, Nov 1, boosting the FBM KLCI to hover at the 1,500 psychological level.

At 10:30am, the benchmark index was up 1.57 points to 1,507.23 while banking stocks such as CIMB added seven sen to RM8.36, AMMB climbed seven sen to RM6.39, Public Bank rose four sen to RM12.76 and RHBCap up eight sen to RM8.11.

Plantation stocks that took the lead include Sime Darby that grew three sen to RM8.86 while KLK was unchanged at RM19.80.

There were 311 gainers and 257 losers while 211 stocks remained unchanged. Top gainer was Kulim which rose 40 sen to RM10.10 with turnover of 376,900 units while Carotech was the most actively traded stock with 28.73 million shares traded.

Newly listed MMHE, which was closely focused last Friday, has dipped 3-sen to RM4.48.

Dr M: Gold dinar will end currency wars

KUALA LUMPUR: The use of the gold dinar in settling international trade should be considered as a way to end the currency war, said former Prime Minister Tun Dr Mahathir Mohamad.

He also said the dinar should be used to settle international trade and not as a domestic currency as it was cumbersome; however, he said the gold bullion could be kept as savings.

Speaking to reporters after delivering his keynote address at the 1st World Conference on Riba (interest/usury) here on Monday, Nov 1, Mahathir said the devaluation of currencies would contribute to worsening the global economic crisis.

"The ringgit is still undervalued (as it was once at 2.5 to the US dollar, pre-1997 Asian financial crisis)," he said. "If our neighbours had much weaker currencies than ours, we would face stronger competition, but for now we are still competitive."

Hwang DBS Vickers Research maintains Buy on MAHB

KUALA LUMPUR: Hwang DBS Vickers Research said Malaysian Airport Holdings Bhd (MAHB) 3Q10 core net profit of RM82.9 million (down 1% q-o-q) was above its expectation but in line with consensus.

It said on Monday, Nov 1 that MAHB's lower staff cost and strong passenger volume supported earnings.

'MAHB said 4Q10 should be seasonally stronger on higher passenger traffic. Hence, we look to raise FY10F earnings by c.5-10%. Maintain Buy, our SOP-derived TP of RM6.15 is under review with upward bias,' it said.

Hwang DBS Vickers Research said it continues to like MAHB for its long-term earnings potential from its cash-rich airport concession, land development, as well as the new LCCT.

'There could be more upside from its overseas investments, which we have yet to factor in our valuations,' it said.

Market starts November on firm note

KUALA LUMPUR: The local stock market started off on a firm note for November, with banks taking the lead while Malaysian Malaysian Marine and Heavy Engineering Holdings Bhd extended its gains.

At 9am on Monday, Nov 1, the FBM KLCI was up 5.03 points to 1,510.69. Turnover was 25.84 million shares valued at RM13.32 million. There were 89 gainers, 22 losers and 84 stocks unchanged.

Among the banks, CIMB rose 10 sen to RM8.39, AMMB added seven sen to RM6.39 and Public Bank gained six sen to RM12.78.

MMHE rose seven sen to RM4.58. Its institutional price was RM3.80 and retail price RM3.61.

TSM was the top gainer, up 27 sen to RM4.29'' with 20,500 shares done.

Among PLANTATION []s, KL Kepong rose 18 sen to RM19.98 and Kulim 10 sen to RM9.80.

Hovid shed 4.5 sen to 14 sen, Carotech 1.5 sen to 5.5 sen and Hovid-WA one sen lower to three sen

Petra-WA jump, ignores MARC caution

KUALA LUMPUR: The warrants on PETRA PERDANA BHD [] surged in early trade on Monday, Nov 1 on the first day of trade.

At 9.14am, it was up 30 sen to 50.5 sen with 4.18 million units done. The shares, inched up 1.5 sen to 80.5 sen, off its early low of 78 sen.

The FBM KLCI rose 3.25 points to 1,508.91. Turnover was 117.14 million shares valued at RM65.98 million. There were 185 gainers, 74 losers and 129 stocks unchanged.

Malaysian Rating Corp Bhd placed its A+ rating on Petra Perdana's RM800 million dual currency revolving facility on MARCWatch Negative.

The rating action was triggered by the group's poor financial performance in the six months ended June 30, 2010.

During the period, Petra Perdana incurred pre-tax loss of RM30.7 million due to falling charter rates, lower capacity utilisation and decrease in contribution from its integrated brownfield services division.

'Due to its inability to secure adequate contracts, six of its 23 offshore support vessels are currently in lay-up and are awaiting disposal,' MARC said.

Sunrise advances on upbeat outlook

KUALA LUMPUR: Shares of SUNRISE BHD [] advanced in early trade on Monday, Nov 1 following the upbeat outlook as it plans to launch at least four major property projects with gross development value (GDV) totalling RM2.7 billion next year.

At 9.27am, Sunrise was up nine sen to RM2.37 with one million shares done.

The FBM KLCI was up 2.80 points to 1,508.46. Turnover was 174.53 million shares valued at RM103.88 million. There were 222 gainers, 110 losers and 179 stocks unchanged.

Sunrise anticipates better results for FY2011 ending June 30, given its large unbilled sales of RM1.2 billion.

Its executive chairman Datuk Tong Kooi Ong said that among those slated to be launched would be the 'MK20' mixed development project in mid-2011 with GDV of about RM1 billion, stressing that the project nestled in Mont'Kiara would be multi-phased, offering different kinds of products.

'MK20 will meet the demands of the market,' he said after the group's AGM last Thursday, Oct 28.

Tong also said Sunrise would likely launch the Menara Solaris office buildings in the city centre early next year and that it was deliberating on whether the project with a GDV of RM480 million would be sold en-bloc or in the market.

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Hwang DBS Vickers Research: External factors to decide KLCI direction

KUALA LUMPUR: Hwang DBS Vickers Research said after extending its run-up to linger somewhere above the psychological mark of 1,500, what's next?

In its outlook report issued on Monday, Nov 1, it said bit by bit, the key FBM KLCI edged higher through the week, chalking up a weekly increase of 15.0-points or 1.0% to settle at its intra-week high of 1,505.66 on Friday.

Similar gains were also made by the FBM 70 Index (+0.6%) and the FBM ACE Index (+1.7%) as rotational plays dominated the market activity. Daily average volume, meanwhile, eased a little to 1.3b shares (from 1.4b units) valued at RM1.7b (RM1.7b previously).

'The spotlight for this week will be on the external front. To be more specific, greater-than-usual interest will be shown when the U.S. Federal Open Market Committee (FOMC) meets on Tuesday and Wednesday (Nov 2-3).

'And for a change, the attention should be less on interest rate hikes (which are not expected to be forthcoming anytime soon). Instead, all ears will be on an expected announcement by the policymakers regarding details (specifically the size and time-span) of another asset purchase program,' it said.

Hwang DBS Vickers Research said also called the QE2 (Quantitative Easing Part 2), this will result in the injection of additional money into the financial system.

While the action of increasing money supply will hopefully stimulate economic activity and boost employments ' the effectiveness of which will only be known later on ' its effects could be felt quicker in the global equity markets.

Hwang DBS Vickers Research said essentially, the flood of liquidity in search of better returns may soon make its way to the growing Asian economies. In turn, this would drive up local currencies and inflate the prices of financial / property assets.

If so, then emerging markets like Malaysia will stand to benefit too. An inflow of funds could be looking for new investment opportunities on our domestic bourse especially should the US$ continues to lose its value against other currencies including the Ringgit.

For a macro feel, foreigners may also want to assess our economic conditions. They will get to check the September external trade statistics, which will be out on Wednesday (3 Nov), particularly the exports and imports performance vis-''-vis its regional peers following the strength of the Malaysian currency.

In addition, an update on the international reserves level as at 29 Oct (scheduled for release on Thursday, Nov 4) could offer a hint or two on the appeal of our country in attracting fund flows after it registered a larger-than-normal fortnightly increase of US$4.8b in the second half of Sep and US$3.9b in the first half of Oct, respectively.

Hwang DBS Vickers Research said at the rate our local bourse is going, its bellwether FBM KLCI could be tiptoeing its way to its previous record peak of 1,524.69 sooner or later. Standing at a fresh 33''-month high at this juncture, a breakout from its immediate resistance barrier (of 1,525) may then send the benchmark index to scale a series of higher highs going forward.

On the chart, the FBM KLCI would be subsequently eyeing 1,550 as its next resistance target.

Hwang DBS Vickers Research said even as the key barometer is now riding on a positive momentum within a mini upward sloping passage, the possibility of intermittent market corrections still exist.

If the FBM KLCI ' after climbing in 18 out of the past 22 weeks for a cumulative gain of 236.5-point or 18.6% ' slides below the resistance turned- support level of 1,495, then the second support line is seen at 1,465.

'Any pullbacks, nonetheless, will probably be short and shallow, which have been the case since late-May this year,' it sais.

OSK Research cautions on possible profit taking

KUALA LUMPUR: OSK Research said with the upside for most Asian markets limited in October, small caps outperformed the FBM KLCI as expected, leading to four out of its five Top Buys outperforming the benchmark.

'For November, we caution on potential profit taking. Investors may well wish to focus on sectors where the results for 3Q2010 are expected to be more resilient, as well as stocks that are off the radar screens of foreign investors such as the Consumer sector, while keeping an eye on the 2 upcoming by-elections,' it said in its outlook report issued on Monday, Nov 1.

OSK Research said its November Top Buys are two defensive stocks (KPJ and CI Holdings), and three situational plays (Kencana, Kulim and Naim Holdings).

#Flash* Petronas Chemicals to offer 2.48b shares in IPO, retail price at RM5.05 each

KUALA LUMPUR: Petronas Chemicals Group Bhd (PGB) is offering 2.48 billion shares under its initial public offer (IPO), of which 1.178 billion will be existing shares and the remaining 700 million new shares.

According to its prospectus on Monday, Nov 1, the retail shares would be offered at RM5.05 per share.

Based on the eight billion shares to be listed, including the new shares, the total market capitalisation will be RM40.40 billion.

The listing exercise includes offering for sale existing 1.78 billion shares. Of this, 1.148 billion shares would be offered to the Malaysian and foreign institutional and selected investors including approved Bumiputera investors.

The retail offering of 293.02 million existing shares to the Malaysian public, eligible directors of PGB and Petroliam Nasional Bhd (Petronas) at RM5.05 each, subject to a refund of the difference if the final retail price is below the retail price.

PGB said the exercise will involve the public issue of 700 million new shares to Malaysian and foreign institutional and selected investors at the institution price.