July 4, 2007

Daily Commentaries 5th July 07

The KLCI chalked up a 4 pts gain on a volume of 1.25bn shares after taking its cue from foreign markets. For today, Boustead announced plans to acquire a 45% stake in Royal & Sun Alliance Insurance (M) Bhd for RM148.8m while Petra Perdana signed a MOA to buy a RM49.7m anchor handling tug. The Plantation Industries and Commodities Ministry is coming out with the National Timber Industry Policy soon to help the timber industry move up the value chain. The shareholder agreement on the Penang Outer Ring Road is ready for submission to the EPU. BAT is raising its cigarette prices be between 8 to 14% after a rise in excise duty on tobacco. On a foreign front, Indonesia has capped new foreign investment in parts of the telecommunications and transport sectors while the buyout of Hilton Hotels by US private equity firm Blackstone Group lifted markets in Europe although US markets were closed for their independence day holiday. Without any negative news today with the exception of the continuing development at Megan Media, we expect the market to continue its run testing the 1380 pts resistance level.

July 3, 2007

Daily Commentaries 4th July 07

The KLCI continued its uptrend, testing the 1,375 resistance level. In general, regional markets also closed positive. Ingress has been awarded a RM26.7m transmission installation contract from TNB, while Ekovest has signed a deal with Credence Resources and Danga Bay Holdings to buy the entire shares of Danga Bay Sdn Bhd for RM1.1bn. Tradewinds Corp has denied any group-wide restructuring plan while Bandaraya and Kumpulan Hartanah have denied any privatization plans. Meanwhile, Megan Media Holdings is in the midst of preliminary discussions with its creditor banks to regularise its financial condition and has about seven months to submit its plan to the relevant authorities. The local bourse may take cue from the firm closing on the Dow last night with high crude oil prices as a concern. Immediate support and resistance are at the 1,360 and 1,380 levels, respectively.

July 2, 2007

Daily Commentaries 3rd July 07

The market did start on a positive note closing above the previous resistance of 1360 although volume traded was under 1bn, indicating the overall subdued undertone. Banking stocks contributed to the bulk of KLCI’s gains. Headline news today are massive losses posted by both Megan Media and Transmile – both counters will be re-quoted today. Excise duties of cigarettes have been increased to 15sen a stick from 12 sen a stick previously, resulting in a 60sen hike for a 20 stick pack. AirAsia plans for 25 more Airbus A320s, raising the total orders for the said aircraft type to 175. Aside from that, Naim Cendera has secured an RM88m road upgrading job in Sarawak while crane maker, Favelle has landed a deal to supply offshore pedestal cranes to Singapore’s Keppel Fels Ltd. Property companies should benefit more from the latest initiatives to introduce a matching grant of RM100m to establish Malaysia as a property haven. There is room for further upside on the KLCI today with the strong 126 points rally on the Dow last night. Immediate support now rests at 1360.