Saturday, October 30, 2010
Friday, October 29, 2010
Late buying on index-linked stocks on Friday, Oct 29 pushed the FBM KLCI closer the all time high of 1,516 on Jan 11, 2008 as sentiment was underpinned by the listing of Marine and Heavy Engineering Holdings Bhd (MMHE).
MMHE closed at RM4.51, up 71 sen from its institutional offer price of RM3.80. The retail price was RM3.61. There were 142 million shares transacted.
Analysts said the listing of MMHE provided the much needed spark for the market which had seen some consolidation after failing to close above the key 1,500 level in recent days.
Research houses had target prices for MMHE – a leading heavy engineering and marine services provider -- ranging from RM4 to as high as RM4.72, which is a premium of between 10.8% and 30.7%, based on the retail price of RM3.61. The institutional price is RM3.80.
Analysts said the MMHE would be part of fund managers’ portfolio and would definitely attract strong interest. They expected the shares to make a strong debut, which would in turn also generate excitement for the launch of Petronas Chemicals Group Bhd next Tuesday.
Among the index-linked stocks of the FBM KLCI, CIMB rose 10 sen to RM8.29, Axiata Group gained seven sen to RM4.49, pushing the index up by a combined 3.21 points. GENTING BHD added 16 sen to RM10.44 and Genting Malaysia advanced 10 sen to RM3.50, piling a combined 2.37 points to the index. KL Kepong 24 sen to RM19.80, DiGi.com 14 sen to RM25.34 and MISC 11 sen to RM8.78.
Major asian markets closed mixed
In Hong Kong stocks edged lower on Friday, closing out a second week of losses as financials weighed on disappointing results and as investors pumped money into shares of AIA which jumped 17 percent on its debut.
The benchmark Hang Seng index ended down 0.49% at 23,096.32, closing below a previously long-held resistance level at 23,100 and sparking concern that the break above that level would not hold.
AIA Group Ltd climbed to HK$23.05 in its Hong Kong debut on Friday as investors, chasing exposure to Asia's fast-growing life insurance business, piled into the record offering in the world's hottest IPO market.
In Tokyo, Japan's Nikkei average fell 1.8% to a seven-week closing low on Friday as disappointing earnings hit shares of companies such as Sharp, with downward momentum accelerating after the index breached a key technical support level.
Investors were keen to lighten long positions ahead of the weekend and before a blizzard of earnings reports due after the close on Friday and a highly anticipated Federal Reserve policy-setting meeting on Nov. 2-3.
The benchmark Nikkei ended down 163.58 points at 9,202.45, its lowest close since Sept. 9, while the broader Topix slipped 0.4% to 810.91. Traders said foreign brokerages could be actively selling.
So far this year, the Nikkei has lost nearly 13%, while the Dow Jones industrial average has gained 6.6% and Britain's FTSE 100 is up about 5%.
The Malaysian stock market added less than a point - but that was enough to extend its winning streak to four sessions, gathering nearly 10 points or 0.6 percent along the way. The Kuala Lumpur Composite Index remained just below the 1,500-point plateau, and now investors are looking for another slightly higher open when the market kicks off trade on Friday.
The global forecast for the Asian markets calls for little activity as investors are largely waiting on the two big events next week - the U.S. elections on Tuesday and the FOMC's announcement on quantitative easing a day later. Oil stocks and properties may see some weakness, although gold miners and brokerages may provide limited support. The European and U.S. markets finished slightly higher, and the Asian bourses are expected to track the same way.
The KLCI finished flat on Thursday as gains from the financial shares were largely erased by selling among the industrials and the plantation stocks.
For the day, the index added 0.33 points or 0.02 percent to finish at 1,499.44 after trading between 1,495.55 and 1,501.57. Volume was 1.14 billion million shares worth 1.63 billion ringgit. There were 427 decliners and 350 gainers, with 287 stocks finishing unchanged.
Among the actives, AMMB, CIMB, Tenaga, DiGi.com, Maxis and PPB all finished higher, while Sime Darby ended flat and Genting was lower.
Wall Street offers little guidance with perhaps a hint of upside as stocks ended on a mixed note on Thursday, unable to sustain any clear direction ahead of next week's midterm elections and the Federal Reserve's anticipated stimulus announcement. The lack of conviction came despite an unanticipated decline in jobless claims to a three-month low.
In employment news, the Labor Department reported that initial jobless claims fell by 21,000 to 434,000 in the week ended October 23rd, with the unexpected decrease dropping claims to their lowest level since early July. Excluding the July number, which was distorted by the July 4 holiday, jobless claims were at their lowest level since August of 2008.
In earnings news, Microsoft Corp. said after the markets closed that its first quarter profit rose 51 percent from last year. The company's quarterly earnings per share also came in above analysts' expectations as did its quarterly revenue. The world's largest software company reported net income for the first quarter of $5.41 billion or $0.62 per share, compared to $3.57 billion or $0.40 per share for the year-ago quarter.
Also, 3M (MMM) reported third-quarter net income of $1.53 per share, which edged out analyst estimates, and its revenues of $6.9 billion also exceeded expectations.
Additionally, Exxon Mobil Corp. (XOM) said its third-quarter net income rose to $1.44 per share, beating estimates by a nickel on revenues of $95.30 billion.
Meanwhile, British biopharmaceutical company AstraZeneca Plc (AZN) reported a sharp decline in its third-quarter profit, as generic competition and the absence of H1N1 vaccine revenues recorded last year dragged down U.S. performance. However, AstraZeneca's core earnings and revenues met estimates. The company also tightened its full-year earnings guidance, lifting the lower end of the range.
The major averages all saw choppy movement in late-session dealing, ending near the flat line. While the Dow slipped 12.33 points or 0.1 percent to 11,113.95, the NASDAQ rose 4.11 points or 0.2 percent to 2,507.37 and the S&P 500 inched up 1.33 points or 0.1 percent to 1,183.78.
In political news, the annual summit of the Association of South-East Asian Nations (ASEAN) opened Thursday in the Vietnamese capital of Hanoi. Natural disasters in Indonesia and non-inclusive elections in Myanmar loom over the gathering, where leaders are set to discuss ASEAN community building process and define priority in the future.
The three-day summit will witness the signing of a series of agreements to harmonize regional trade, communication and transport. A geo-political and economic organization formed four decades ago, ASEAN has a population of 580 million with a combined GDP of about $1.5 trillion. The bloc is made up of Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.
Thursday, October 28, 2010
Wall Street’s QE2 rally hit a bit of turbulence on Wednesday as the Dow dropped triple digits before recovering amid concerns that the Fed’s plan to boost the economic recovery may not be large enough.
Stocks spiraled lower today, as investors considered the prospect of a milder-than-expected economic intervention by the Federal Reserve. The Wall Street Journal can take most of the credit for raining on the bulls' parade -- this morning, the newspaper reported that Fed officials next week are likely to unveil a plan to buy "a few hundred billion dollars" in government bonds over the course of three months, compared to the central bank's ambitious March 2009 initiative to purchase $1.75 trillion in Treasury and mortgage bonds. The Journal explained that the Fed is simply trying to keep its options open as the economy lurches unsteadily toward recovery, but traders took the news pretty hard. In fact, the market wasn't even encouraged by stronger-than-expected reports on durable goods orders and new home sales, with some viewing the solid data as further indication that the Fed will err on the side of modesty.
The Dow Jones Industrial Average (DJIA – 11,126.28) was off nearly 149 points at its session low, but the blue chip barometer pared the worst of its intraday deficit to close on a loss of 43.2 points, or 0.4%. Only nine of the Dow's 30 components finished higher, led by recent laggards American Express (AXP) and Bank of America (BAC), while McDonald's (MCD) and Merck (MRK) led the 21 decliners into the red. The Dow found support today near the 11,020 neighborhood, which is home to its rising 20-day moving average.
Crude futures fell in sympathy with stocks today, as expectations for a relatively modest stimulus effort from the Fed propped up the U.S. dollar. An unexpected weekly decline in domestic gasoline inventories helped crude oil recover from its intraday nadir of $80.52 per barrel, but the greenback's surge kept the dollar-denominated commodity under pressure through the close. Crude oil for December delivery shed 61 cents, or 0.7%, to end at $81.94 per barrel.
“People have gotten a little bit complacent in terms of expectations for the Fed’s QE2 to be the [cure] to heal all wounds. Traders knew at some point those questions would come up. It was just a question of when.”
Wednesday, October 27, 2010
Traders Lock In Profits
Stocks on Bursa Malaysia rose 0.14% to close at 1499.11 points on Wednesday, after rising as high as 1504.37 points on selective buying in key heavyweights. However, the market failed to uphold the strong momentum in the afternoon due to profit taking as investors took cue from the weaker overseas markets.
The FBM KLCI closed in positive territory but just shy of the 1,500 -point mark on Wednesday, Oct 27, after key regional markets declined following the slump at the Hong Kong and China stock markets.
Strong Dollar gave the bears a head start but the bulls still triumph by the slimmest of margin at the finishing line - a nose.
Tuesday, October 26, 2010
FBM KLCI 26 October 2010
As indicated by A, the FBM KLCI rose 5.5 points to close at 1496.94 points. Resistance for the KLCI is still at 1500 level while the support is at 1480 level.
Meanwhile, the Bollinger Bands expanded 9%, with the KLCI above the Bollinger Middle Band, thus the Bollinger Bands is showing an improvement signal. If the Bollinger Bands should continue to expand, while the KLCI above the Bollinger Middle Band, more upside movement is likely for the KLCI.
As indicated by B, total market volume increased 21.6%, with volume above the 40-day volume moving average. Overall, market is well-participated, thus the market sentiment is likely to stay positive.
As indicated by C, the Stochastic breaks above 70%, re-entering the short term bullish region. Therefore, the Stochastic is now showing a short term bullish signal.
In short, the KLCI is showing some sign of picking up some strength, and if the KLCI could break above the 1500 level, it would break away from its consolidation and continue its uptrend movement.
The Malaysian stock market has alternated between positive and negative finishes through the last five trading days, since the end of the three-day losing streak in which it had declined more than 15 points or 1.1 percent. The Kuala Lumpur Composite Index remained just above the 1,490-point plateau, and now analysts are forecasting a mildly positive open on Tuesday.
The global forecast for the Asian markets is mildly positive on solid earnings and economic news. Technology stocks are expected to provide support, along with airlines and gold miners - although the financials may come under pressure. The European and U.S. markets finished higher on Monday, and the Asian bourses are predicted to follow suit.
The KLCI finished flat on Monday, nudged slightly higher by gains from the financial shares, industrial issues and plantation stocks.
For the day, the index added 0.80 points or 0.05 percent to finish at 1,491.44 after trading between 1,495.74 and 1,491.25. Volume was 1.131 billion shares worth 1.47 billion ringgit. There were 511 gainers and 268 decliners.
Among the actives, Kuala Lumpur Kepong, Public Bank, Maybank, CIMB and Sime Darby all finished higher, while Genting, Axiata and RHB Capital ended lower.
Buying interest in the session came as the world's finance ministers announced an avoidance of competitive currency devaluation over the weekend, leading to substantial dollar weakness. The greenback hit a fresh 15-year low against the yen while also sliding against the euro and the British pound.
Amid a relatively light day on the U.S. economic calendar, the National Association of Realtors said existing home sales jumped 10.0 percent to a seasonally adjusted annual rate of 4.53 million in September from a downwardly revised 4.12 million in August.
Economists had expected sales to rise to an annual rate of 4.25 million from the 4.13 million originally reported for the previous month. While existing home sales rose for the second consecutive month, the annual rate remains 19.1 percent below the 5.60 million-unit pace seen in September of 2009.
In other news regarding the housing sector, Federal Reserve Chairman Ben Bernanke revealed that reviews of foreclosure practices by major banks will be unveiled in November. The report is expected to gauge the effect of errors on the real estate market and major financial institutions. The housing market remains weak and high levels of mortgage distress may well persist for some time to come, Bernanke also said.
On the earnings front, Texas Instruments Inc. said Monday after the markets closed that its third quarter profit rose 60 percent from last year, helped by higher revenue and improved margins amid growth in all of its business segments. The company's quarterly earnings per share also came in above analysts' expectations as did its quarterly revenue. The world's second largest maker of mobile phone chips reported net income for the third quarter of $859 million or $0.71 per share, compared to $538 million or $0.42 per share for the year-ago quarter.
The major averages all saw some downside in late-session dealing but still managed to close at their best levels in nearly six months. The Dow gained 31.49 points or 0.3 percent to close at 11,164.05, the NASDAQ advanced by 11.46 points or 0.5 percent to 2,490.85 and the S&P 500 rose by 2.54 points or 0.2 percent to end at 1,185.62.
“It’s all the dollar. If the dollar goes down, the market goes up. It’s as simple as that,”
NYSE analyst Irwin Taylor Head of Research Monex Equities
As indicated by A, the FBMACE continued its consolidation on Monday, gaining 4.19 points or 0.1%. Resistance for the FBMACE remains at 4330 WinChart Automatic Fibonacci Retracement while the support is still at 14, 21, 31 EMA, which is the dynamic support.
As circled at B, the Stochastic fell below 70% by margin on Monday, and if the Stochastic should stay below 70%, it would be an end to the short term bullish signal. If the FBMACE should continue to consolidate, the Stochastic is expected to stay around 50% level.
As circled at C, the MACD histogram is still falling, as it suggests that the FBMACE is still losing strength. The weakening movement of the FBMACE is expected to continue until the MACD histogram should form a Rounding Bottom.
In short, the uptrend is unaffected but the FBMACE is expected to stay in consolidation, until the re-expansion of the Bollinger Bands. If the Bollinger Bands should re-expand with the FBMACE above the Bollinger Middle Band, there is a good chance that it would resume the uptrend.
如图中箭头A所示，富时大马创业板指数周一继续盘整格局，按日微扬4.19点或0.1%。创业板阻力水平仍然是4330点的费氏阻力线，支持水平则继续是14、21、31天综合加权移动平均线（Exponential Moving Average – EMA）的动态支持线。
如图中C圈所示，平均乖离震荡指标（MACD Histogram）继续下滑，这表示创业板继续盘整，甚至有稍微转弱的可能。以技术而言，创业板盘整格局将持续下去，直到平均乖离震荡指标形成圆底（Rounding Bottom）为止。