Monday, December 24, 2012

World Bank Upbeat On Malaysian Economy

KUALA LUMPUR: The World Bank says Malaysia will be able to weather a weak global environment next year, thanks to its resilient domestic demand.

Malaysia had performed well this year despite weakening demand from advanced economies and China, the bank said. 

This dichotomy, it added, can be sustained next year. 

In its latest East Asia and Pacific Outlook, the World Bank has projected Malaysia to grow by 5.0 per cent in 2013. 

"There is momentum in investment growth. A number of projects that contributed to the surge in investment in the first half of 2012 will continue to contribute a larger amount of value-added to the economy in the near term.

"There is a positive feedback loop among the implementation of investment projects, fiscal policy, and private consumption," it said, referring to the tight labour market which will support consumption growth.

The World Bank does not expect commodity prices to decline significantly in 2013, which will provide support to fiscal policy and investment growth.

Global outlook for next year will improve compared to 2012.

"Should a new shock lead to a significant deviation from this baseline, exports would contract and commodity prices would decline, which would unravel the favourable dynamics described above."

Malaysia's near-term outlook hinges on the structural reforms.

But it also said Malaysia's fiscal policy will have to walk a fine line towards consolidation without disrupting the growth momentum.

"Malaysia's near-term outlook owes much to commodity sectors."

It said a significant portion of investments had been directly in the oil and gas sector, the expansion in public consumption and capital formation had been financed to a significant degree by commodity revenues (present and future), while investments in real estate are, to some extent, also linked to the recycling of commodity revenues.

"These investments are part of a sound strategy to ensure that the resource sector continues to provide revenues in years to come."

But it warned that, by themselves, they bring risks related to possible shocks to commodity prices and, conversely, higher commodity prices may lead to "Dutch disease" and a loss of competitiveness in tradeable manufacturing and services sectors.

"To mitigate these risks, Malaysia needs to accelerate the implementation of productivity-enhancing reforms to boost capabilities and competition, and thus raise productivity of non-commodity sectors."

-- BTimes

Saturday, December 22, 2012

Bursa's Performance Will Not Affect GE Outcome

PETALING JAYA (Dec 21, 2012): There is little correlation between stock market rallies and general election (GE) results in Malaysia, said M & A Securities Sdn Bhd, based on its examinations of the past six election results.

"Based on the results of the percentage of seats that the incumbent government Barisan Nasional (BN) won in the previous six elections in Malaysia and the performance of the FBM KLCI, there has been low correlation of only 0.4 between the performance of the stock market and the results of the GEs," said the research firm in a report on Wednesday.

"Therefore, we can surmise that the performance of the stock market does not have much bearing on the outcome of GEs in so far as the BN is concerned."

M&A Securities said this also means the "feel good wealth factor" from a good stock market performance does not necessarily translates into a better election performance for the incumbent BN government.

"If we examine the past six GE results, the percentage of BN Parliamentary seats have been swinging between one GE to the next GE from the high to the low and the low to the high and so it has been repeated.

"Therefore, the "pendulum theory" whereby election results see-saw between high and low from one GE to the next GE has more proof to it than the theory that a good stock market performance will translate into a strong incumbent government BN performance in the upcoming GE," it added.

M&A Securities recalled that 2008 was an isolated incident where a bad stock market performance preceded the worst GE outcome for BN since 1969.

"In 2008, the stock market was down 9.7% year-to-date as at March 7, 2008 prior to the March 8 GE. That year, the BN had its worst outcome in the election where it was denied its customary two-thirds majority and won only 63% of parliamentary seats.

"However, one outlier does not proof that a bad stock market performance preceding a GE will lead to a bad GE result for the incumbent government BN," said M&A Securities.

"Similarly, in 1986, when the FBM KLCI was down 4.6% as at Aug 1 1986 prior to the Aug 3 GE, the BN had one of its best performances with 86% of the parliamentary seats," it added.

M&A Securities noted that the FBM KLCI has year-to-date performed well in 2012, in line with regional bourses.

"This year, the FBM KLCI has rose 7.8% as at Dec 13.

"How the stock market will perform in the first quarter of 2013 is debatable as the fund managers may want to re-balance their portfolio from the high beta stocks, which are laden in the FBM KLCI 30 index weightage, into the low beta stocks such as plantation, oil and gas and consumer stocks which have less constituents in the FBM KLCI 30 index and therefore, this strategy may not push the FBM KLCI by much but may either push it down or sideways," it said, adding that 13th GE is likely to be held in March or April next year.

-- TheSun

Friday, December 21, 2012

Merry Christmas & Happy New Year 2013

Today is the mark of beginning New World Age according to Mayan Prophecy/Calendar (after 7am). This transition of World Ages is calling us to re-connect with nature's wisdom - re-establish our harmonious interconnection with all of life that we may awaken our human potential and align with the next evolutionary stage that earth is entering into. Today we should be lucky enough as we are still here and reading my below greetings. Cheers!

Happy Merry Christmas! 
Wishing you and your family have a very wonderful day and may this festival bring abundant joy and happiness in your life!

Well, another fresh year is almost here, another brand new year to live!

Last but not least,
Wishing our Bursa Malaysia will bring us more $,$$$,$$$ in 2013!!!

Tuesday, December 18, 2012

General Election May Rejuvenate Local Stock Market

THE upcoming 13th general election may rejuvenate Malaysia's weak stock market and continue bucking the trend in the first half of 2013.

Malaysia has until April next year to dissolve Parliament and until June to hold a general election.

Nomura International (Hong Kong) Ltd managing director and chief Asia equity strategist and global head of equity strategy Michael Kurtz said the long awaited 13th elections should be the key driver for Malaysian equities in the first half of 2013 overshadowing other challenging macro global factors.

The global factors, including slower economic growth prospects in China and Europe, the Greece debt crisis and the US economic slowdown, could result in near-term volatility for the market.

"In our view, the uncertainties surrounding the election outlook, coupled with the investors' unwillingness to take risk ahead of the elections, could result in extreme volatility in equity prices," Kurtz said here yesterday at a media briefing on its Asia Pacific outlook 2013.

Kurtz said Nomura Equity Research is maintaining its assumption that the ruling government would win by a majority similar to what it holds currently and any weaknesses in the market would present a good buying opportunity.

He said Malaysia's stock market has been soft over the past nine months as investors' exposure to Malaysia is relatively lower compared to other Asian markets which are more sought after.

To ride through the volatility period ahead of the elections, Kurtz said investors should be well positioned in the defensive sectors such as telecommunications stocks, which Nomura has raised to overweight from neutral, and maintains a bullish stance on banking, construction, plantations, and oil and gas sectors.

The Japanese research house has selected stocks such as Axiata, Maybank, Sime Darby, AirAsia, WCT, SapuraKencana, CIMB, Genting, Media Prima and MMC Crop as its top picks.

Nomura said Malaysia's better-than-expected third quarter gross domestic product (GDP) growth and the expected resilient fourth quarter estimates would continue to support further upward revisions in the next few months.

"As a result of the good third quarter, we now expect full-year 2012 GDP growth of 5.3 per cent (up from 4.8 per cent last year) and we believe this is achievable as China is expected to rebound in the fourth quarter of this year, which should benefit commodity exporters such as Malaysia."

On Asia, Nomura Equity Research is bullish on Asia's stock markets but it gave "underweight" outlook on Southeast Asian countries which include Malaysia.

Kurtz said it's not that Asian stocks are not good but equity markets in North Asia are looking more attractive in terms of value, in line with an improved global economic outlook.

Kurtz said North Asian markets such as in South Korea and Japan have been shunned for the past few years due to their cyclical nature and volatility but with the change in economic factors, they are working in favour for these markets compared to Asean which has always been perceived as defensive in nature. 

-- By Zaidi Isham Ismail 

Monday, December 17, 2012

My 1st Reaction as Stock Market Newbie #1

OxO * Old time story for my memory refreshment * OxO

I was getting my first full time job in 1995 with a salary of RM1.5K per month. As a fresh graduate (under graduate at that time), the important is to work, get experience and move step by step through corporate ladder. I think most of us are following the same path – study and graduate, find job and earn the paycheck. I am still novice and did not have any plan what I want to be in next few years or how I want to use my paycheck. I just keep working and save some money. By end of 1995, I have my saving around RM15K in bank.

My dad one day talk to me, he mention about stock market, shares, remisier, broker, buying lots, politics, this and that. I know nothing about it. What is that? I am rather dumb and I did not read much newspaper as well! He said I can use some of my saving to invest in the market and the investment will keep growing in years to come. So I follow what he said, I open my first account with Hwang DBS.

Here I go, now I can buy shares and own small tiny little pie as shareholder of a company. I was thinking, should I use all my saving? My only first knowledge about stock market is 'Put my saving in shares, it will go up in long term'. So I decided to throw all RM15K into the stock market.

My dad did recommend me to buy a few counters, if I remember correctly it is MULPHA around RM1.3x and TANCO around RM1.9x (property counter) per lot. I just follow and buy and fully use up all RM15K. At that time I have no commitment to made, so I have no problem to let my saving floated in the market. 

I has been told to read more on business newspaper, so I just follow and start reading on business columns. Most of the time, I read the shares price columns (there is lack of internet services around that time, the only info I can get is from newspaper). Few weeks later, I was surprise to see both counters start moving up. This is the best moment of joy! I look for MULPHA and TANCO, seeing the price appreciation, make me feel good - Yes, my investment really bear fruits. I smile happily.

To be continue.....

My Stock Trading Journey Stories
Next: My 1st Reaction As Stock Market Newbie #2

Saturday, December 15, 2012

Will Tiger Synergy Live Up To Its Name?

LILY is a flower that symbolises unions, partnership and long lasting relationships. It is just the medicine ordered by the doctor for Tiger Synergy Bhd, a company that many still are unsure if it is a genuine takeover target or a well drawn plan by a beautiful mind.

One thing is for sure, Tiger is no Ingenuity Solutions Bhd. Thus far, nobody has walked from Low Yat Plaza to Federal Hotel, to announce to the media, that they want to take over Tiger.

Tiger's biggest misfortune is that the tussle comes just months after the Ingenuity Solutions takeover offer that left many investors losing their pants.

To recap, Ninetology Marketing Sdn Bhd had offered in September to buy out the major shareholders of Ingenuity at 55 sen a share in a deal valued at RM360 million.

The deal would have resulted in Chin Boon Long, who had a 29.15 per cent stake in Ingenuity, walking away with a cool RM90 million and booking a gross profit of about RM70 million.

Chin, however, rejected the offer. Today, Ingenuity trades at about 10 sen a share. Chin made the news again in November when he emerged as a substantial shareholder in Takaso Resources Bhd. Takaso stole the trading limelight this month when the shares hit the roof in a single trading day.

Investors are genuinely concerned that Tiger could be a "value trap". As one seasoned investor noted, the concern is that once you buy large quantities of the share, the fear is that the whole battle will die down and the shares will tank.

The plus point for those keen on Tiger are the personalities behind the tussle - namely the two new shareholders. The duo, Datuk Seri Abdul Azim Zabidi and Datuk Seri Mohd Nadzmi Mohd Salleh, are respected businessmen. 

Abdul Azim was a former chairman of Bank Simpanan Nasional Bhd while Mohd Nadzmi was a former chairman of Proton Holdings Bhd. They are unlikely to risk their reputation just to help "fry" the stock.

To their credit, they have kept silent, built up their stake in Tiger, and then sought to remove Tiger's entire five-member board of directors via an extraordinary shareholders meeting.

Since the duo had bought the shares in Tiger via privately held companies, one could assume that their intention is to hold on to Tiger's main board listing status. 

In today's marketplace, the listing status itself could be worth anywhere from RM5 million to RM20 million.

The motion to dismiss the entire Tiger board drew an immediate response from the company. A media report quoted Tiger's executive director Shirley Tan Lee Chin as saying "having the unusual market activity and volatility in the share price is not in the best interest of our minority shareholders".

It should be noted that since the rumours started circulating on a possible play for the company, Tiger had done some cool placement business.

In November, cash flowed into the company via proceeds from two tranches of private placement, raising more than RM10.8 million, while proceeds from the conversion of warrants into mother share came up to about RM4 million thus far.

Not bad for a company that had less than RM2 million in cash before November, while minority shareholders saw the value of their shares briefly surpass the 49 sen a share level this year, a price level last seen in 2008.

For those of us who have forgotten, Tiger was just a 10 sen stock a year ago.

The EGM, if it does take place, will help clear investors concern that all this is just not a show.

Assuming the showdown at the EGM does indeed take place, Tiger is poised be live up to its name and lay its claim as the first "super bull" stock in the Year of the Water Snake. 

--Francis Fernandez

Thursday, December 13, 2012

NASDAQ OMX To Power Bursa Trading

KUALA LUMPUR: Bursa Malaysia and NASDAQ OMX Group Inc,today announced that Bursa Malaysia has selected NASDAQ OMX to power its securities market trading through NASDAQ OMX's industry leading technology, X-Stream INET.

The new platform will handle trading of equities, fixed income, ETF, funds and issuer warrants for Bursa Malaysia. X-Stream INET's system robustness and speed will drive exchange innovation for Bursa Malaysia to attract a variety of market participants and create innovative products and services to match international demand. The deployment is scheduled during the first quarter of 2014. NASDAQ OMX was selected in competition with a number of global exchange technology

Dato' TajuddinAtan, CEO, Bursa Malaysia, said, "As we aimed to complete a major technology refresh for our securities market and build on our overall strategic business roadmap, we wanted a trading technology that would satisfy our demands and desire for growth. Selecting NASDAQ OMX's X-Stream INET was a sign of this commitment to our customers and our growth towards becoming the center of ASEAN's multinational marketplace. We feel we have chosen the right partner for our future and look forward to a successful implementation of X-Stream INET."

Anna Ewing, Executive Vice President and CIO, NASDAQ OMX, said: "We are happy to be partnering with one of the leading exchanges in Asia. Bursa Malaysia is both an attractive IPO destination and a hub for Islamic finance. As Bursa Malaysia looks to advance its growth strategy and expand on its vision of delivering industry-leading products and services, we're dedicated to supporting its endeavors through our technology."

NASDAQ OMX's X-stream trading technology is currently used by 22 exchanges globally and has recently been named the world's fastest trading system by independent latency measurement specialists. -- Bernama

Thursday, December 06, 2012

The World's Best Places to Live 2012

Can there be a city that is crime and pollution free, with excellent public transport and great schools to boast?

Human resources consulting firm Mercer has put together a list of cities that come closest to offering you all that. In its 2012 Quality of Living report it looks at living conditions in 221 cities worldwide and ranks them against New York as a base city in 10 categories - economy, socio-cultural environment, politics, education, and healthcare.

1. Vienna, Austria

Austria's most populous city – Vienna – has won the title of the world's best city for quality of life since 2009. It is also one of eight European cities to make the top 10 list, showing the region's dominance in the survey.

Vienna is the cultural, economic, and political center of the country. It has the highest per capita GDP among all Austrian cities at over $55,000. Vienna's ability to transform old infrastructure into modern dwellings won the city the 2010 United Nations urban planning award for improving the living conditions of its residents. Under a multimillion-dollar program, the city refurbished more than 5,000 buildings with nearly 250,000 apartments. Vienna is also the world's No. 1 destination for conferences, drawing five million tourists a year — equivalent to three tourists for every resident.

The country's economy has, however, not been immune to the crisis plaguing Europe, and shrunk 0.1 percent in the third quarter of the year, as the European Union entered its second recession since 2009.

2. Zurich, Switzerland

Zurich, Switzerland's largest city, keeps the number two spot from last year after holding the title of the city with the best quality of life in the world previously. It is also one of three Swiss cities to make the top 10 rankings – tying with Germany for the most number of cities on the list.

Known as a global financial center, one out of every nine jobs in Switzerland is based in Zurich. Its low tax rates attract overseas companies and the assets of the 82 banks based there are equivalent to more than 85 percent of the total value of assets held in Switzerland. The city is also the country's biggest tourist destination, famous for its lakeside location and chain of hills that run from north to south, providing an extensive range of leisure activities.

The cost of living in Zurich is the sixth highest in the world, according to Mercer. Both Zurich and Geneva make Switzerland the most expensive country to live in in Western Europe. The city also attracts people to buy luxury properties here, because of its low taxes, safety record and good education system, according to real estate firm Knight Frank.

3. Auckland, New Zealand

New Zealand's largest and most populous city, Auckland, offers the best quality of life in the Asia-Pacific region, now for the second year in a row. It has been consistently placed within the top five best places to live in for the past six years.

Auckland is uniquely set between two harbors, with 11 extinct volcanoes and numerous islands making it the city with the world's largest boat ownership per person. Auckland is New Zealand's economic powerhouse - its 1.4 million people account for more than 30 percent of the country's population and contribute 35 percent to the country's GDP. Auckland is also home to the most educated people in the country, with nearly 37 percent of its working population holding a bachelor's degree or higher.

In March, the city launched a 30-year initiative called "The Auckland Plan" to make it the world's most livable city. The plan aims to tackle challenges in transport, housing, job creation and environment protection. However, the city has been impacted by the global economic slowdown. In the third quarter New Zealand's unemployment rate hit a 13-year high of 7.3 percent.

4. Munich, Germany

Munich is Germany's third largest city and one of the country's key economic centers. It is also one of three German cities to dominate the top 10 rankings for the best quality of life.

Holding on its fourth spot from last year, Munich is home to some of Germany's most notable businesses, including engineering firm Siemens and insurer Allianz. The city generates nearly 30 percent of the gross domestic product of the State of Bavaria. Munich's per capita purchasing power was more than $33,700 in 2011, the highest among all German cities and 30 percent above the national average. Drawing immigrants to its industries from all over the world, more than a fifth of the city's residents are foreigners.

Munich ties fellow German city Frankfurt for having the second best infrastructure in the world, according to Mercer. In total, four German cities including Dusseldorf and Hamburg dominate the top 10 infrastructure rankings highlighting the country's first-class airports and high standard of public services.

5. Vancouver, Canada

Vancouver is the only Canadian and North American city to make the top 10 list this year, similar to 2011.

Vancouver has made it to a number of rankings on the world's most livable cities over the past decade and has been among the top five in the Mercer quality of living survey for the past six years. Home to one of the mildest climates in Canada, Vancouver is also its greenest city with the smallest carbon footprint of any major city in North America. Surrounded by water and snowy mountains, Vancouver's government constantly promotes green building, planning, and technology with the ambition of becoming the world's greenest city by 2020.

In terms of infrastructure, Vancouver also tops the rankings for North America at ninth with Montreal and Atlanta landing in 13th place. Overall, Canadian cities still dominate the top of the rankings for North America despite only Vancouver making it into the global top 10. Ottawa comes in at 14, Toronto at 15 and Montreal at 23, while it's closet U.S. competitor is Honolulu at 28 globally.

6. Dusseldorf, Germany

German city Dusseldorf fell one spot from last year's rankings to take the sixth spot in 2012. However, the city has made Mercer's top 10 rankings for the best quality of life for the past six years.

The city by the river Rhine is the seventh most populated in Germany and is renowned for its fashion and trade fairs. With more than 100 galleries, Dusseldorf is Germany's art capital.

Dusseldorf's high standard of living is a big draw for the ultra-wealthy. The city ranks second only to Munich for the highest population in Germany of people with a net worth $30 million or more at 1,380, according to research firm Wealth-X. Earlier this year, local media also reported that the city has more millionaires than any other German city.

7. Frankfurt, Germany

Frankfurt, the largest financial center in continental Europe, retains the seventh spot from last year's rankings of the best places to live.

Germany's fifth largest city, it is home to major institutions such as the European Central Bank and the Frankfurt Stock Exchange. Frankfurt is also a major transport hub for central Europe given its modern infrastructure, including an integrated high-speed rail network and a busy international airport. The city ranks second only to Singapore in the world for its infrastructure, according to Mercer.

The city is also building a reputation for its environment-friendly initiatives. In 2008, a "low emission zone" was set up in the city and only vehicles with a green badge reflecting low emissions are allowed to enter the area. The aim is to reduce pollution and maintain air quality levels in Frankfurt. More than 50 percent of the city consists of open green spaces and waterways.

8. Geneva, Switzerland

Geneva, Switzerland's second most populous city and home to several international organizations, holds on to the eighth spot it earned in 2011.

Located at the foot of the Swiss Alps, along the banks of Lake Geneva, the city's natural environment also makes it one of the greenest cities in Europe. About 20 percent of Geneva is covered by green areas, giving it the name "city of parks." The city has benefited from strict air pollution laws and other environmental regulations, given that it is the base of many global environmental groups.
As home to a large expatriate community with over 40 percent of its population being foreigners, the cost of living in Geneva is the highest in Western Europe. It's considered the fifth most expensive city in the world, according to Mercer. The cosmopolitan hub is also home to the world's most expensive private schools and is said to have one of the best education systems globally. Geneva's strong economy is also boosted by the fact that it is the world's No. 1 center for oil trading, seeing 35 percent of global volume.

9. Copenhagen, Denmark

Copenhagen, the capital of Denmark, has held on to the ninth spot from last year and marks its sixth consecutive appearance on Mercer's list of the top 15 cities to live in.

Health and well-being is a big priority for the Danish people with nearly a quarter of them aged 60 and older, according to government data. Increased health awareness has translated into Denmark becoming one of the leading consumers and producers of organic food in Europe. Almost 75 percent of food served by city-run businesses like daycares in Copenhagen is organic. Copenhagen is also known as the city of cyclists with a total 218 miles of cycle tracks, resulting in about 35 percent of its population commuting by bicycle every day.

Despite being lauded for its high quality of life, Denmark's economy has struggled, impacted by the euro zone debt crisis. The Danish economy shrank0.4 percent in the second quarter of the year. Consumption, one of the country's main growth drivers, has remained weak even with record-low interest rates, due in part to a property bubble bust in 2007 that has left many households in debt and cautious over spending.

10. Bern, Switzerland

Bern, the capital of Switzerland, fell one spot this year to tie with Sydney at No. 10 after coming in 9th in the quality of living survey for the previous four years.

Located in the Swiss plateau, Bern has been able to maintain its medieval charm. In 1983, its city center known as the old town of Bern became a UNESCO World Heritage Site. Often ranked among the most expensive cities in the world, Bern is the center of Swiss engineering and manufacturing with medical, information technology, automotive, and luxury products such as watches made there.

Last year it was ranked as the second safest city to live in the world after Luxembourg, according to Mercer's survey. Switzerland's reputation as the traditional banking safe haven for the world's wealthy has made it an attractive place for relocation. However, growing immigration has become a major cause of concern for locals who fear that an inflow of foreigners is threatening the Alpine's country's high standard of living. In November, a Swiss environmentalist group presented the government with 120,000 signatures to force a referendum on immigration by calling for an annual limit on the country's population growth via immigration to 0.2 percent. The Swiss population hit the 8 million mark this year – a 140 percent rise from 1990.


Thursday, November 29, 2012

DIGI Always The Smarter Choice

Yes, DIGI always the smarter choice! Do you agree with this tag line? Do you have problem with its network? Do you experience network speed and high availability issue? As per I know previously, Digi always have slow network, unstable and limited coverage area. That should be the reason it loss the market share (Maxis 38%, Celcom 33% and Digi 28%). In term of package now, I think Digi are cheaper compare to other Telcos (Maxis, Celcom). A few of my friends are changing to Digi because of cheaper package!

Do you know Digi currently in the midst of upgrading all the networks? They call it The Tomorrow Network across Malaysia and scheduled completing in 2013. Once ready, Digi will be Malaysia's 1st LTE-equipped network ready to serve fibre-like speeds to upcoming LTE mobile devices. The network coverage will expanded to 95% for its high speed EDGE, 3G with more stable networks and consistent speeds. How true is true? Well, I not really sure as I did not have the chance to FEEL it. Digi subscriber should be happy by now if the upgrading of networks works at your area. Must have the FEEL good factor! Hope this will improve their network performance and attract more subscribers and increase their market pies! Having all this set, than I will be in the waiting list for Digi . :)

Now lets see how is the stock performance? If we are going to invest in long run, I would say it will be a smarter choice to own Digi shares. The shares price able to sustain the broad market sell down in the pass few days and hitting low at RM4.50 (the important uptrend 40-day moving average). A rebound  from this level means that in futures, investor should looks at this level as important support before initiate any sell decision. The current resistance stood at RM5.00~RM5.30 which will indicate the direction it will be heading. Increase your position only when this level are convincingly breakout. Do take note that when shares price falling below the RM4.50, the next critical hold up level for Digi will be RM3.70~RM4.00 (100-day moving average). It seem there is possible this level will be tested if the market condition is not improving in coming months. 

Personally, I see the upside potential for Digi will be limited. It will be entering into consolidation mode soon (medium term) before further price advance can be seen in futures. Overall still a good stock for investment. Cheers!

Happy investing and Good Luck!

Stock Market To See 10% Earnings Growth In 2013

KUALA LUMPUR (Nov 28, 2012): The Malaysian stock market is expected to see a 10% earnings growth next year, driven by the oil and gas (O&G), banking, construction, healthcare and manufacturing sectors, said Eastspring Investments Bhd CIO of equities, Yvonne Tan Hong Yean.

"Currently, it is about low teens of between 10% to 12%. We are expecting a 10% growth rate (for 2013), but much will depend on the crude palm oil (CPO) prices which are going to be low," Tan told reporters after presenting a paper on the Malaysian equity and bond outlook 2013 here yesterday.

She expects the current economic performance and activities under the government's Economic Transformation Programme (ETP) will contribute to the growth.

The local economy grew 5.2% in the third quarter of this year from a year ago, beating economists' estimate.

Tan said Bank Negara Malaysia's GDP forecast of between 4.5% and 5.5% for 2013 is achievable as domestic consumption remains strong and the accelerated public sector spending will support the rising domestic demand.

"We expect an investment revival, led by the private sector, especially in infrastructure and O&G spending," she said. Since its launch in October 2010, a total of 158 projects with total investment of RM231.4 billion has been announced under ETP.

She added that to date, O&G companies have won RM5.8 billion worth of contracts and the market is expecting an upcoming Pan Malaysia hook-up commissioning jobs worth RM10 billion as well as a few more risk-sharing contract marginal field or enhanced oil recovery brown field projects in the near to mid term.

On the impact of the upcoming general election (GE) on the stock market's growth, Tan said: "If the GE outcome is surprising, it may impact the market. When there are uncertainties in the market, investors will stay on sidelines."

She estimates the GE to be held at the end of first quarter 2013, as the election must be called before April 28 2013.

Tan also said Asian cyclical stocks could rally on any good news and valuations look generally attractive, but not all Asian markets are cheap.

"Those driven by the domestic growth look expensive and they could rise in line with profit growth."

Historically, she said Malaysian market is always high in valuation. So, it is seen as a more defensive market.

"In a bull run, it (Malaysian market) has always lagged behind but if there is a sell in the regional markets, it will outperform due to its defensive nature," she added.

Wednesday, November 28, 2012

KLCI: Worse Yet To Come

It has been almost a year since my last coverage on KLCI direction. Today it trigger me to take a clear look at the index after hitting 1600 and close below it. To my surprise GOSH!!! What I can see here, only a red sea yet to come! I would advise those still holding big cap or blue chip or small cap to SELL on any rebound going forward (there would be a moderate rebound towards 163x level coming soon, if I am right). 

Once the rebound done, more downward pressure will be seen to test the intermediate support 1580 level (if that do happen!). I would say this level will not be strong enough to support the sell down. I foresee the sell down might dive to the level 1500, even 152x support will failed! Just my prediction.

Note: Just beware of 1400!!! For time being just look at 1500. We will see how again when time come.....Hopefully 1500 will be the end of the downtrend!

This is not the time to accumulate your stock for long term. Only accumulate for short-term trade on rebound. Sell is the only way for this bear market. Well, 2013 think will not be a good year for our market.  :-(

Hope there will be some small cap/penny stock that can run up. :-)

Happy Trading and Good Luck! 

[Previous KLCI Posting]

Wednesday, November 21, 2012

TIGER What's Next?

Today I make an entry @ 0.325. This will be my 3rd one, previous two trade is a very rush and high velocity trade but I manage to beat the TIGER. :-) How about this 3rd trade? I would say, there is still possible for downside, but I keep my cut-loss tight @ 0.315. If I loss I only will loss 0.010cts (hope it will not gap down!). This will be my risk factor. 

Base on my observation, there is still upside potential above 0.50! I would be paying more attention at 0.46 resistance when it do come. How about 0.41 resistance? Mmmm.. it will not be too hard to penetrate though. Hope I am right.

As for downside, it will dive towards 0.20 if the support 0.31/0.32 fail to hold up in coming few days time. Well, I hope this writing still can valid and not expire for next few days. Hahahaha

Cheers and Good Luck!

Friday, November 16, 2012

IMF Optimistic About Malaysia's Economy

Malaysia will be able to sustain its growth level with its gradual shift from a trade-based economy to a consumption-led one, says the International Monetary Fund
KUALA LUMPUR: The International Monetary Fund (IMF) yesterday placed high confidence in Malaysia's economy, saying that the country will be able to sustain its growth level with its gradual shift from a trade-based economy to a consumption-led one.

Its managing director Christine Lagarde was, however, concerned that despite Malaysia's strong initial public offering performance, foreign direct investment levels have not gone back to pre-crisis levels.

The "reasonably" high level of debt-to-gross domestic product ratio needs to be addressed, she said at a media briefing here yesterday.

The IMF chief is in Malaysia as part of her three-nation Asian tour which will also take her to the Philippines and Cambodia.

In her speech at a global public lecture hosted by the Malaysian Economic Association, Lagarde said although Malaysia has held up well so far with growth above 4.5 per cent, it remains in risky territory as with other Asian economies.

Growth will pick up again and Asia will retain its position as a growth leader, expanding two percentage points faster than the world average next year.

She also spoke about how the West could learn from Asia's own brush with the crisis in the 1990s, which has helped make the region's economic foundations safer, sounder and more resilient.

The IMF chief stressed on the need for American and European policy makers to act amid continued severe challenges faced by the advanced economies.

Although Asia has made strides in trade integration, it is still lagging in financial integration as reflected by the 90 per cent of Asean cross-border portfolio investment flows with advanced economies outside Asia, she said.

Greater regional financial integration can boost domestic demand, making it easier for small businesses in countries like Malaysia to gain access to credit and reduce inequality, she added.

Asia has a unique opportunity to get financial integration right and avoid the missteps and excesses of the West.

Lagarde also discounted the possibility of a global recession next year, saying the economy will grow by at least 3.6 per cent as policy makers continue to act.

When asked on Greece at the media briefing, she said a "real fix", not a "quick fix", was needed to help the country return to economic stability and enable it to re-access markets as soon as possible.

The tone of IMF towards Malaysia was one of appreciation yesterday as the fund acknowledged the country's leading role in building a financial firewall to boost its firepower for the 188-member body by US$461 billion, bringing the total lending power to over US$1 trillion.

She also praised Bank Negara Malaysia governor Tan Sri Dr Zeti Akhtar Aziz, saying that her superior economic management has ensured that Malaysia is well protected and able to handle capital flows without being overwhelmed.

The overwhelming turnout was clearly impressed with Lagarde and her clear message of wanting the fund to have a more "engaging" presence in Asia.

Wednesday, November 14, 2012

Worst Of Europe's Debt Crisis Seems To Be Over

THE worst of Europe's financial crisis appears to be over.

European leaders have taken steps to ease the panic that has plagued the region for three turbulent years. Financial markets are no longer in a state of emergency over Europe's high government debts and weak banks. And this gives politicians from the 17 countries that use the euro breathing room to fix their remaining problems. 

Threats remain in Greece and Spain, and Europe's economy is forecast to get worse before it gets better. But an imminent break-up of the euro now seems unlikely, analysts say. 

"We are probably well beyond the worst," says Holger Schmieding, chief economist at Berenberg Bank in London. He says occasional flare-ups in financial markets are likely, but "coming waves of turmoil will be less severe".

Evidence that Europe has turned a corner can be found in countries' falling borrowing costs, rising stock markets and a slow but steady stabilisation of the region's banking system:

* The interest rates investors are demanding to lend to struggling countries such as Spain and Italy have plunged - a sign that investors are less fearful about defaults. Spain's two-year bonds carry an interest rate, or yield, of just under 3 per cent, down from a July 24 peak of 6.6 per cent. Italy's bond yields have dropped just as sharply. 

* The Stoxx 50 index of leading European shares has surged 26 per cent since June 1, while the euro has risen from US$1.26 to US$1.29 over the same period. 

* After months of withdrawals, deposits are trickling back into Greek and Spanish banks, signaling that fears of their imminent financial collapse are abating. And US money market mutual funds loaned 16 per cent more to eurozone banks in September. That was the third straight monthly increase in short-term funding to European banks, and follows a 70 per cent reduction since May 2011. 

More proof the crisis is easing: Gatherings of European financial ministers no longer cause global stock and bond markets to gyrate with every sign of progress or a setback. 

As financial-market panic recedes, euro leaders have more time to try to fix the flaws in their currency union. Among the challenges are reducing regulations and other costs for businesses in order to stimulate economic growth, and imposing more centralised authority over budgets to prevent countries from ever again spending beyond their means. That's important because a major cause of the crisis was Greece's overspending during the calm years after the euro's introduction in 1999, and Italy's failure to cut the high levels of debt it joined with. Other governments - such as Spain and Ireland - were saddled with debt piled up by banks and real estate developers during boom years. 

Much of the credit for easing Europe's financial crisis goes to the European Central Bank (ECB), which has become more aggressive over the past year under the leadership of Mario Draghi. 

The ECB said on September 6 that it was willing to buy unlimited amounts of government bonds issued by countries struggling to pay their debts. The ECB's pledge instantly lowered borrowing costs for Spain and Italy, which earlier in the year had faced the same kinds of financial pressures that forced Ireland, Greece and Spain to seek bailouts. 

"Financial market confidence has visibly improved," Draghi said on Thursday during a press conference. 

The ECB's actions are reminiscent of some of the emergency steps the Federal Reserve (Fed) took after the US financial crisis struck in 2007. The Fed offered banks cheap loans, cut short-term interest rates to record lows and started buying bonds to ease long-term borrowing rates and boost the confidence of consumers and businesses. 

The Fed couldn't prevent the US from enduring its worst recession since the Great Depression. But its actions defused panic in the financial markets and helped restore the health of US banks. 

German Chancellor Angela Merkel has also helped ease financial tensions across Europe by speaking more forcefully about the need to hold the euro together. 

Merkel's support is critical because Germany, the eurozone's largest economy, has the most at stake financially in any bailouts. Merkel has backed the ECB's bond-buying plan and has made conciliatory statements toward Greece. 

That has paved the way for the so-called troika of international lenders - the ECB, the European Union and the International Monetary Fund - to allow Greece more time to meet deficit-reduction targets. The Greek Parliament took a big step on Wednesday toward securing its next batch of rescue loans from the troika by approving a new round of tax hikes and spending cuts. 

Another key breakthrough in the financial crisis came in late June, when leaders meeting in Brussels took new steps to steady banks and governments. They agreed to ease up somewhat on austerity demands; to use bailout funds to buy government bonds and help ailing banks; and to create a single supervisor for all of Europe's banks. 

Some analysts worry that as the financial pressure eases, Europe's leaders could lose their recent momentum. A break-up of the euro "is still possible", says Marie Diron, senior economic adviser to Ernst & Young. "I don't think we have removed the risk altogether." 

Europe's leaders have big challenges left. 

The most pressing is saving Greece. If the country was forced into a default and began printing its own currency, investors would assume other countries might go next and begin pulling their money out of those countries too, or demand higher returns to keep it there. The coming months could severely test Germany's new willingness to help. Despite two bailouts totaling (euro) euro240 billion (RM938 billion) since 2010, Greece needs an estimated euro30 billion (RM117 billion) more from the other eurozone countries as its economy shrinks. 

Berenberg's Schmieding thinks there's a 25 per cent chance that Greece will leave the euro in the next six months, if its parliament balks at painful austerity measures and euro members are reluctant to provide more help. But he thinks a Greek departure would cause "only temporary damage". Other economists think it could break up the euro. 

Another hotspot is Spain, the eurozone's fourth-largest economy. The country's debts are piling higher as its regional governments struggle and its economy shrinks. The ECB's offer two months ago to buy unlimited amounts of government bonds is a potential life-saver, but the country's Prime Minister Mariano Rajoy needs to formally request such aid. He has held off, apparently hoping the current market calm will last and he won't suffer the political humiliation of taking a bailout. Analysts say that if he waits too long Spain's borrowing costs could rise again to unsustainable levels and reignite broader fears in financial markets. 

Banks are another problem. Weakened by massive losses on the government bonds they bought and real estate loans that aren't being repaid, banks across the eurozone have been propped up by governments that are themselves struggling financially. Even with the help, these banks have been forced to reduce lending, which has hurt Europe's economy. 

A banking supervisor for all of Europe could provide some relief, by forcing crippled banks to merge with healthier ones. But it will be the second half of next year, at the earliest, before the supervisor is in place, banking analysts say. European leaders disagree over how much authority to give the supervisor and how to fund it. 

Economic growth is what would ultimately end Europe's crisis. But robust growth remains far off. The European Union forecast on Wednesday that the 17-nation eurozone economy would grow just 0.1 per cent in 2013. 

Privately, European officials say the ECB's bond-buying plan has afforded them a crucial window of opportunity - a year, perhaps - to resolve their biggest challenges. 

Much depends, they say, on what gets accomplished in that time. AP

Saturday, November 10, 2012


TAKASO, the name is so hot for the last 2 weeks. Charging to 0.40 before heavy profit taking! The sell down was surprising too strong! Going below 0.32 which make me feel little uncomfortable. So, still have upside? Yes, if it still hold strong above 0.27. There should be a rebound coming next weeks. I would be looking for a trade and sell at resistance 0.35 if possible. By than I think it will move side ways for a while and we will see how it goes for the next target.

BENALEC, behave well and steady at the moment. Still unwilling to go down 1.28/1.29 :-) Good sign. It looks like going to test 1.42/1.43 for the 3rd time. If this can go through, than we are going for 1.70/1.80. I will be joining the boat then, yeah!. if this fail, time to looks for 1.28 and 1.35 support for the next direction.

Happy Trading and Good Luck!

Monday, November 05, 2012

Sandy May Slow Malaysian Economy In Short Term

KUALA LUMPUR: Hurricane Sandy will not have a major impact on the Malaysian economy as the calamity will only affect the global economy in the short run, said S Das & Associates Pty Ltd consultant Satyajit Das.

“I don't think it will have a major impact in the long run because in the short run it will have a reduction in growth obviously in this quarter and probably in the next quarter.

“The reconstruction part of it will be funded by reinsurance from outside the United States.

“What happens is that some things you can control and some things you don't control.

“You are going to be impacted by this but the degree to which you will be affected is unknown and you have been a beneficiary in a year or so of certain things like when Japan made a decision to turn off its nuclear plant, it is very good for your LNG exports,” he told reporters after delivering an afternoon talk titled “The End of Growth?” yesterday.

Hurricane Sandy's economic toll is expected to exceed US$20bil after the biggest Atlantic storm slammed into the Eastern US, damaging homes and offices and flooding subways in America's most densely populated city.

Sandy, spanning about 1450 km, slammed into southern New Jersey on Monday and brought a record storm surge of 4.2 m into Manhattan's Battery Park while flooding, high winds and fallen trees cut power to about eight million customers from South Carolina to Maine and travellers were stranded as US airlines grounded more than 16,000 flights.

US stock trading closed back-to-back earlier this week in the first back-to-back shutdown for weather since 1888. “You will be a beneficiary because your interest rate is high relative to developed markets. What we have seen is a lot of capital flows which is very helpful in funding your development and so forth,” he said.

“If the US, Europe, China and Japan which make up 70% to 80% of the world's (economy) and if their demand goes down, it is difficult not to see Malaysia not to get impacted. It is a question of degree. I think you can protect yourself a bit as you have some good industries like obviously the petroleum industry and agriculture,” he added.

Das is also an author and an international specialist in financial derivatives and capital market, with over 30 years' experience in the financial market.

The afternoon talk was organised by the Malaysian Investment Banking Association. - Bernama