#Stocks to watch:* Telcos, Bonia, Bina Puri, Ivory

KUALA LUMPUR: Key Asian markets may rise in cautious trade on Friday, Sept 17, including Bursa Malaysia which resumes trading, after US stocks closed mostly flat on mixed data on Thursday.

The Dow Jones industrial average gained 22.10 points, or 0.21 percent, to 10,594.83. The Standard & Poor's 500 Index dropped 0.40 points, or 0.04 percent, to 1,124.67. The Nasdaq Composite Index gained 1.93 points, or 0.08 percent, to 2,303.25.

Reuters reports that investors were not keen to snap up US stocks amid mixed economic data and a cautious forecast from economic bellwether FedEx kept the market locked in its recent tight trading range.

Shares in FedEx Corp fell 3.7 percent to $82.72 after the company, seen as a proxy for economic demand because of the wide swath of industries it serves, forecast quarterly profit below Wall Street's expectations and warned the recovery may slow.

A drop in initial jobless benefit claims to a two-month low in the most recent week was not enough to lift stocks, while a gauge of business activity in the U.S. Mid-Atlantic region showed a contraction for a second straight month in September.

However, a Reuters poll of institutional investors and strategists found U.S. stocks are expected to make strong gains before year-end as worries about a second recession subside.

Stocks to watch on Friday include telco players Maxis Bhd, Telekom Malaysia and DiGi.com, Bonia Corp Bhd, BINA PURI HOLDINGS BHD [] and Ivory PROPERTIES [] Group Bhd.

InsiderAsia, whose report appears in The Edge FinancialDaily, said despite the cellular market's relative saturation ' with penetration rate estimated at roughly 116% ' key players continued to chalk up positive subscriber growth in 2Q10.

This saw the net increase for 1H 2010 increase to 1,515,000 subscribers for Maxis, Celcom and DiGi.

The Edge FinancialDaily also highlights fashion retailer Bonia Corp Bhd's latest acquisition of a 70% stake in Singapore-based Jeco Pte Ltd.

The report said this may prove to be quite a gem as it adds more brands and a new money-spinner to its stable.

The Edge FinancialDaily reports that Paramount Corp Bhd will be in a position to dish out a special dividend as a result of the RM131 million proceeds raised from the sale of its 20% stake in Jerneh Insurance Bhd.

Meanwhile, Bina Puri's order book increased to RM2.57 billion to date after it secured a contract to build the proposed 13-storey Plaza Merdeka commercial complex/hotel along Pearl Street, Kuching for RM95.69 million.

It had accepted a letter of award from Rakyat Elite Sdn Bhd for the project which was expected to be completed within 19 months.

The recent award saw the group's current book order stands at RM2.57 billion as at to date.'' The group had managed to secure new projects worth RM1.62 billion in 2010.

Ivory Properties plans to build residential condominiums and commercial complex with a with an estimated gross development value (GDV) of RM368 million on a proposed site in Tanjong Tokong, Penang island

Ivory intends to develop the land under a proposed project named 'City Mall' consisting of approximately 175 units residential condominiums and commercial shopping complex with an estimated GDV of RM368 million'' and estimated gross development cost of RM173 million.

The expected profit before tax to be derived from the development is RM154 million, it said.

PETRA PERDANA BHD []'s renounceable rights issue of up to 122.76 million new 50 sen shares, of the basis of three rights shares for every eight shares held, has been fixed at 59 sen.

The corporate exercise, which includes one warrant for every two rights shares, included the fixing of the exercise price of the warrants at RM1 each. The entitlement date has been fixed on Oct 1.

#Flash* N. American semicon equipment makers record US$1.82b orders

KUALA LUMPUR: North America-based manufacturers of semiconductor equipment posted US$1.82 billion in orders in August 2010, based on a three-month average basis.

According to the report published on its website on Thursday, Sept 16, the Semiconductor Equipment Manufacturers Industry (SEMI) said the book-to-bill ratio was 1.17. A book-to-bill of 1.17 means that US$117 worth of orders were received for every US$100 of product billed for the month.

'The three-month average of worldwide bookings in August 2010 was US$1.82 billion. The bookings figure is 1.1 percent lower than the final July 2010 level of US$1.84 billion, and is 195.5 percent above the US$614.5 million in orders posted in August 2009,' it said.

SEMI said the three-month average of worldwide billings in August 2010 was US$1.55 billion. The billings figure is up 3.8% from the final July 2010 level of US$1.50 billion, and is 167.6% above the August 2009 billings level of US$580.0 million.

"Overall equipment billings increased 4% in August resulting in the highest levels experienced since September 2007," said SEMI president and CEO Stanley T. Myers said.

"While bookings declined slightly in August, 2010 is still on track to be a record growth year for semiconductor equipment.'

The SEMI book-to-bill is a ratio of three-month moving averages of worldwide bookings and billings for North American-based semiconductor equipment manufacturers.

Wall St stays in tight range on mixed data

NEW YORK:'' U.S. stocks were little changed on Thursday, Sept 16 as mixed economic data and a cautious forecast from economic bellwether FedEx kept the market locked in its recent tight trading range.

Shares in FedEx Corp fell 3.7 percent to $82.72 after the company, seen as a proxy for economic demand because of the wide swath of industries it serves, forecast quarterly profit below Wall Street's expectations and warned the recovery may slow.

A drop in initial jobless benefit claims to a two-month low in the most recent week was not enough to lift stocks, while a gauge of business activity in the U.S. Mid-Atlantic region showed a contraction for a second straight month in September.

The S&P 500 has settled into a range between support at its 200-day moving average around 1,115 and resistance around 1,130. Attempts to pierce 1,130 have been thwarted several times since June, including this week.

"We are just in the same growth path we were before the double-dip fears -- that is why the market is just kind of stuck, volumes are kind of low, and there is no conviction one way or the other," said John Canally, investment strategist and economist for LPL Financial in Boston.

"Today, jobless claims were good, corporate earnings data not so good, and that's the tug of war you are in today."

The Dow Jones industrial average gained 22.10 points, or 0.21 percent, to 10,594.83. The Standard & Poor's 500 Index dropped 0.40 points, or 0.04 percent, to 1,124.67. The Nasdaq Composite Index gained 1.93 points, or 0.08 percent, to 2,303.25.

Oracle Corp, the No. 3 software maker, and BlackBerry maker Research in Motion Ltd rose in extended trade after posting quarterly results that topped Wall Street's expectations.

Oracle shares gained 4.1 percent to $26.41 and Research in Motion jumped 8.4 percent to $50.40 in extended trade.

Texas Instruments Inc shares rose 3.5 percent to $25.85 after the bell as the chip maker increased the amount of stock it would repurchase and boosted its quarterly dividend by 8 percent.

On Thursday, The Labor Department said the seasonally adjusted index for prices paid at the farm and factory gate increased 0.4 percent, the largest increase in five months, after gaining 0.2 percent in July.

Analysts polled by Reuters had expected producer prices to rise 0.3 percent last month. In the 12 months to August, producer prices increased 3.1 percent, slowing from the prior month's 4.2 percent increase.

The Philadelphia Fed's survey, expected by a Reuters poll to show growth in manufacturing, showed falling activity for the second consecutive month and was a reminder of the pressure still on the recovery.

Weakness in FedEx spilled over to the rest of the sector. Rival United Parcel Service Inc shed 1.4 percent to $66.72, and the Dow Jones Transportation average lost 1 percent.

Ford Motor Co rose 4.8 percent to $12.44 after Barclays upgraded the stock to "overweight" from "equal weight," saying the U.S. automaker's earnings power has risen, driven by its vehicles and U.S. pricing.

A Reuters poll of institutional investors and strategists found U.S. stocks are expected to make strong gains before year-end as worries about a second recession subside. - Reuters

Oracle profit beats Street forecasts

SEATTLE: Oracle Corp said on Thursday, Sept 16 fiscal first-quarter profit rose 20 percent, beating expectations, on strong sales of new software and growth of its new hardware business.

The strong results bucked the trend of recent pessimism among tech companies about the economic recovery, and investors sent Oracle shares up 4 percent in after-hours trading.

"Despite the fact that the economy is having difficulties, for Oracle it continues to show that their consolidated strategy continues to pay off," said Michael Yoshikami, chief investment strategist at YCMNET Advisors.

"The broader tech sector is showing that though the economy is struggling, TECHNOLOGY [] is probably going to be a bit more resistant to the economic downturn as companies look to become more efficient with fewer employees."

The world's No. 3 software maker, which sells business software, database systems and now server hardware through its recent purchase of Sun Microsystems, reported net profit of $1.35 billion, or 27 cents per share, compared with $1.12 billion, or 22 cents per share, in the year-ago quarter.

Excluding some items, it reported a profit of 42 cents per share. That beat Wall Street's average estimate of 37 cents per share, according to Thomson Reuters I/B/E/S.

Revenue rose 50 percent to $7.6 billion on a non-GAAP basis, helped by the acquisition of Sun earlier this year. Analysts were expecting $7.27 billion, on average. GAAP revenue increased 48 percent to $7.5 billion.

New software sales -- which generate long-term maintenance contracts, signaling future profitability -- were up 25 percent at $1.3 billion. The company had forecast three months ago they would rise between 2 percent and 12 percent.

"Our software business grew strongly in all regions," Oracle President Safra Catz said in a statement. "Our hardware business also grew faster than we expected with Sun Solaris servers and Exadata leading the way."

Oracle's shares were up 4 percent at $26.40 after closing at $25.36 on Nasdaq.

The company is expected to make a forecast on sales of new software for the current quarter on a conference call later on Thursday.

Chief Executive Larry Ellison and new President Mark Hurd -- the former Hewlett-Packard Co CEO who joined Oracle earlier this month -- are expected to talk to investors on that call. - Reuters

U.S. jobless claims at two-month low, PPI rises

WASHINGTON: New U.S. claims for jobless benefits hit a two-month low last week, hinting at some stability in the labor market, while the contraction in factory activity in the Mid-Atlantic region slowed in September.

The reports on Thursday, Sept 16 further reduced the odds of a double-dip recession and suggested less of a need for the Federal Reserve to launch a fresh round of asset purchases to aid the economic recovery.

"The economy is growing at a very moderate pace, the strong elements of the upturn are unwinding, but we are not going into a new downturn," said Steven Wieting, an economist at Citigroup in New York.

Initial claims for state unemployment benefits slipped 3,000 to 450,000, the lowest since early July, the Labor Department said. Financial markets had expected a rise to 460,000.

Separately, the Philadelphia Federal Reserve Bank said its business activity index covering the mid-Atlantic moved to minus 0.7 in September from minus 7.7 in August. Markets had expected a reading of 2.0.

Any reading below zero indicates falling factory activity. The Philadelphia Fed report follows a report on Wednesday showing manufacturing growth in New York State slowed in September.

U.S. stocks ended little changed as the manufacturing report took away some of the optimism generated by the weekly jobless claims data.

Stock market players also took to the sidelines as FedEx Corp , often seen as a proxy for the U.S. economy, forecast profit for the current quarter below Wall Street's expectations and warned of a slower economic recovery. [ID:nN16235653]

U.S. Treasury debt prices fell and the dollar was little changed against the yen.

Although details of the Philadelphia Fed's report were grim, analysts cautioned the survey had consistently underperformed relative to the national manufacturing and other regional surveys.

"It seems the weakness may be regionally concentrated and not representative of national trends," said Nicholas Tenev, an economist at Barclays Capital in New York. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

U.S. jobless claims graphic: http://link.reuters.com/dyw93p

Producer prices graphic: http://link.reuters.com/sex93p ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

RECOVERY TOO SLUGGISH TO CUT UNEMPLOYMENT

Manufacturing has led the economy's recovery from its worst downturn since the Great Depression as businesses sought to rebuild inventories from record low levels. But growth has been too slow to reduce a 9.6 percent unemployment rate.

Frustration over a lack of jobs is eroding President Barack Obama's popularity among Americans and could see the Democratic Party severely punished in Nov. 2 congressional elections.

Many analysts predict Republicans could take control of the House of Representatives from Democrats.

But there are tentative signs of improvement in the jobs market. Claims for jobless benefits have fallen for two straight weeks, pulling them further away from the nine-month high of 504,000 touched in mid-August.

Claims are now in the upper end of a 400,000-450,000 range that analysts associate with stable job growth.

The Fed is closely watching the jobs market and the drop in claims eases pressure on it to launch a fresh round of government debt purchase at a meeting on Tuesday. Many analysts, however, continue to expect the central bank to ease monetary policy further in coming months.

The argument for the Fed to stay pat next week was also bolstered by a 0.4 percent increase in the producer price index in August, which calmed fears of deflation -- a broad-based decline in consumer prices.

"The data we have in hand don't suggest a quantitative easing restart is required. The downside economy and deflation risks look decidedly less so, for now," said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ in New York.

Prices paid by producers at the farm and factory gate were pushed up by the first increase in energy costs since March. Markets had expected the PPI to rise 0.3 percent after July's 0.2 percent gain.

Food prices, which rose in July, fell in August.

Stripping out volatile food and energy costs, core producer prices edged up 0.1 percent, matching market expectations.

This "core" index was held back by a fall in passenger car prices, which offset an increase in the cost of light motor trucks. In the 12 months to August, the core index has risen 1.3 percent, a bit of a slowdown from the 1.5 percent registered through July. - Reuters

Credit agency model may have to be changed- SEC member

WASHINGTON: Credit rating agencies' business models may have to be changed in order to mitigate their conflicts of interest, a Securities and Exchange Commission member told Reuters on Thursday, Sept 16.

"I think there are thorny issues. We have a long way to go," said SEC Commissioner Elisse Walter, one of the five officials who decides on federal securities rules.

Under the recently passed Wall Street reform law, the SEC must find a solution to conflicts at the biggest rating agencies Moody's Corp, McGraw-Hill Cos' Standard and Poor's, and Fimalac SA's Fitch Ratings.

The Big Three agencies are paid by the issuers whose bonds they rate.

"There are conflicts. The question is what you do with the conflicts. The question is once you get over the hurdle and end up with sound disclosure of what the conflicts are, how do you cure them," Walter said in an interview.

"It may be that we have to change the business model, but I am not convinced yet whether we do or we don't," she said.

The SEC may be forced to adopt a congressional proposal that would upend the rating agencies business model if it does not find a way to mitigate conflicts of interests within two years, according to the legislation.

That proposal would create a board to match rating agencies with debt issuers.

The SEC has been trying to increase competition in the industry dominated by the Big Three. It also has adopted a number of rules to improve disclosures and prevent issuers from shopping for the most favorable rating. But it has not been able to find a solution to the conflicts of interests at the issuer-paid model.

In addition to new credit agency rules, the SEC must write some 100 new rules for financial players and markets under the Wall Street reform bill.

The SEC and futures market regulator, the Commodity Futures Trading Commission, are starting to craft rules to shed light on the $615 trillion over-the-counter derivatives market.

Walter said it was imperative that the SEC and CFTC were able to cross jurisdictional lines and access information about equities and futures markets.

"We need information about the futures market. The CFTC needs information about the securities market because in today's world, strategies are executed across jurisdictional lines," she said.

"Regulators need information that goes beyond their jurisdictional line." - Reuters

Dell expands into western China, plans base by 2011

LOS ANGELES: Dell Inc plans to open a second production base in China as part of a spending spree it said could top $100 billion in 10 years, expanding into the country's less-developed but rapidly growing western region.

Dell's new manufacturing and sales base, in the major city of Chengdu, should be up and running by 2011 and house some 3,000 staff eventually, the world's third-largest PC maker said on Thursday, Sept 16.

Foreign players from Hewlett-Packard to Acer have made inroads in past years into what is now the world's second-largest personal computer market.

Dell, which said it commands 9 percent of that market, plans to support its expansion in the country by hiring 500 staff at its current operations base in the southeastern coastal city of Xiamen.

The company's revenues in China have surged 11 times from 2000 to 2010, and grew 52 percent in the last fiscal quarter, it said.

Including hiring, research, CONSTRUCTION [] and procurement from local suppliers, Dell estimates it could spend more than $100 billion over the next decade in its largest market by revenue outside of the United States.

"Our new operations there will better position Dell for additional growth opportunities in western China," said Amit Midha, Dell's China president.

The company's stock held steady at $12.30 in morning trade. - Reuters

World stocks fall on US data, dollar gains

NEW YORK: World stocks fell on Thursday, Sept 16 as data showed the U.S. economy's recovery remained tepid, while the dollar rose to a session high against the yen a day after Japan's huge intervention to weaken its currency.

U.S. government bond prices fell after Philadelphia Federal Reserve data suggested slower business contraction in the U.S. Mid-Atlantic region, while U.S. claims for unemployment benefits dropped to a two-month low but still remained high.

Gold rose to a record high above $1,275 per ounce as jitters about any further Japan yen selling and broader economic uncertainty enticed more investors to the safe-haven commodity.

"We've had a lot of negative things thrown at market this morning, and it's battling back against a lot of economic and other fundamental negative news. Volumes are extremely light," said Tom Schrader, managing director, U.S. Equity Trading at Stifel Nicolaus Capital Markets in Baltimore.

The Dow Jones industrial average was down 11.73 points, or 0.11 percent, at 10,561.00. The Standard & Poor's 500 Index was down 3.16 points, or 0.28 percent, at 1,121.91. The Nasdaq Composite Index was down 4.65 points, or 0.20 percent, at 2,296.67.

The FTSEurofirst 300 index of top European shares fell 0.8 percent as weak British retail sales data added to investor worries about the economy following disappointing U.S. numbers in the previous session. The share index is up about 5 percent in September but off about 3 percent from its April peak.

MSCI's All-Country World Index was down 0.33 percent, while Tokyo's benchmark Nikkei stock index ended down 0.07 percent.

YEN TALK

Investors were still coming to terms with Wednesday's currency intervention by Japan, its first in six years. The Bank of Japan's money market data showed the yen-selling intervention may have totaled around 1.76 trillion to 1.86 trillion yen ($20.52-21.69 billion).

Adding to investor nerves, Japanese Prime Minister Naoto Kan pointed to more potential yen selling.

The dollar reached as high as 85.84 yen on electronic trading platform EBS. It was last up 0.1 percent at 85.79 yen.

"There's no sign of the Bank of Japan this morning yet on markets, but they were successful yesterday and we are beginning to see some funds moving in the same direction, unwinding long yen positions," said Greg Salvaggio, vice president of trading at Tempus Consulting in Washington.

Wednesday's move was designed to protect Japanese exports from a too-competitive exchange rate and ward off job losses. Some market players may be willing to test Japan's resolve, but there was little indication on Thursday.

The euro rose to its highest in more than a month against the dollar to $1,3112 and the yen to 112.24 after strong demand at a Spanish bond auction reinforced confidence in Europe's sovereign issues.

The Swiss franc weakened broadly after the Swiss National Bank kept interest rates unchanged as expected and forecast a slowdown in economic growth because of strength in the currency.

Spain sold a combined 4 billion euros in 10-year and 30-year bonds, at the top of its targeted range, attracting solid demand and lower yields than its last auction in June.

The country was among those most in the limelight during the sovereign debt crisis earlier this year.

BONDS AND COMMODITIES

The benchmark 10-year U.S. Treasury note was down 12/32, with the yield at 2.7645 percent after data showed slower business contraction in the U.S. Mid-Atlantic region.

The 2-year U.S. Treasury note was up /32, with the yield at 0.4796 percent. The 30-year U.S. Treasury bond was down 30/32, with the yield at 3.9293 percent.

In energy and commodities prices, crude oil fell 74 cents, or 0.97 percent, to $75.28 per barrel, and spot gold prices rose $8.90, or 0.70 percent, to $1276.40. Earlier on Thursday it hit a record $1,277.70 an ounce. U.S. December gold futures also rose to a historic high. - Reuters

Europe shares close at week-low on economy worries

LONDON: European shares closed lower on Thursday, , Sept 16 as investors worried that high U.S. jobless numbers, despite falls in weekly claims, and disappointing British retail sales could signal a slowdown in the pace of economic recovery.

The pan-European FTSEurofirst 300 index of top shares provisionally closed 0.8 percent lower at 1,076.35 points to hit its lowest closing level in a week.

New U.S. claims for unemployment benefits dropped to a two-month low last week at 450,000, while British retail sales fell unexpectedly in August for the first time in seven months, a sign the economy was on a slow growth path.

UK retailers were among the decliners, with Next, Marks & Spencer and Home Retail down 0.2 to 0.8 percent.

"Times are difficult because of the combination of high unemployment, banks not lending yet and governments starting to implement austerity measures. All these factors are not going to be resolved overnight," said Franz Weis, a fund manager at Comgest in Paris. - Reuters

Foreigners resume U.S. asset buying in July

NEW YORK: Foreigners resumed purchases of U.S. securities in July, reversing the prior month's net outflow, and China and Japan both added to holdings of U.S. government debt, the U.S. Treasury Department said Thursday, Sept 16.

Overseas investors bought a net $63.7 billion, including short-term instruments such as Treasury bills. That reversed a revised net outflow of $5.2 billion in June. Net long-term capital inflows rose to $61.2 billion from $44.4 billion.

Uncertainty about the global economic outlook and lingering concern about heavily indebted European countries and euro zone banks enhanced the appeal of U.S. assets in early summer.

China, the biggest holder of U.S. Treasury debt, increased its holdings by $3 billion to $846.7 billion. It was China's first increase in three months. Japan, the No. 2 Treasury holder, bought a net $17.4 billion in U.S. government debt, bringing its total to $821 billion.

Both countries provide crucial financing for U.S. deficits. China's purchases also keep the value of its yuan currency from appreciating too quickly against the dollar. Beijing fears a strong yuan would hurt its exports and arrest economic growth.

MORE JAPAN BUYING EXPECTED

Overall Treasury purchases slipped to $30 billion in July from $33.3 billion, but analysts said those numbers should rise in the months ahead now that Japan has also started selling yen in currency markets for the first time in six years.

Dealers said the Bank of Japan spent more than $20 billion on Wednesday to weaken the yen and speculated that much of the dollars accumulated would find their way into U.S. Treasuries.

"It's definitely going into Treasuries, it's just a question of where in the curve," said Alan Ruskin, global head of G10 FX strategy at Deutsche Bank in New York. "We look forward to some big numbers in the months ahead."

Most of the buying in July was in U.S. corporate debt and equities. Foreigners bought a net $13.9 billion in corporate bonds after selling a net $13.5 billion in June. They were net buyers of equities to the tune of $12.5 billion, reversing June's $4.1 billion net outflow.

"Private flows are nice and strong and, most importantly, are well-rounded," Ruskin said. "As we get past the crisis, you're seeing a broadening out of capital flows, and that's encouraging for the dollar."