Friday 29 Mar 2024
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KUALA LUMPUR:  Trading activity is expected to be volatile on May 12, which is settlement day after the surge in trading volume on May 7 and there could be some profit taking, as reflected in recent trading patterns.

However, market sentiment is still firm, as reflected in the broader market and trading volume of 3.85 billion units on May 11. But this will also hinge on external events. 

At the local front, the positive outlook for the economy from Bank Negara is expected to provide some support. Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz says the economy is expected to improve in the second half of 2009, as the government’s stimulus package takes effect.Stocks to watch on May 12 include Malaysia International Shipping Corp (MISC), Scomi Group, Sarawak Energy, MSC, Proton, Ramunia and plantation stocks.

MISC's net profit fell 76% to RM181.9 million in its fourth quarter ended March 31 from RM764.5 million a year earlier mainly due to losses in its liner business. 

Despite the lower earnings, it declared a tax-exempt final dividend of 20 sen per share totalling RM744.0 million versus RM788.3 million in 2008. The proposed dividend would be paid on Aug 28, 2009.

For the 12-month period, net profit fell 41.6% to RM1.4 billion from RM2.4 billion in the previous financial year. 

In Scomi Group,Onstream Marine Sdn Bhd, which is controlled by Datuk Kamaluddin Abdullah and Shah Hakim @ Shahzanim Zain, disposed of 49 million Scomi Group shares on May 11.

Sarawak Energy could attract interest after announcing its MoU with China Three Gorges Corporation dated Aug 16, 2007 had been completed.  Sarawak’s Natural Resources and Environment Board had approved the revised Environmental Impact Assessment report.

However, Sarawak Energy had also announced its that regarding its MoU with Cahya Mata Sarawak and Rio Tinto Aluminium Ltd, dated Feb 11, 2008, the parties were still in talks to finalise the terms of the power purchase agreement.

Malayan Smelting Corp posted net loss of RM5.6 million in 1Q ending March 31, a contrast from the net profit of RM15.3 million a year ago. The loss was due  to the sharp drop in tin prices, which affected its Indonesian tin operation, as well as forex translation losses arising from the group’s US dollar borrowing. 

Meanwhile, analysts said Proton is expected to fork out between RM20 million and RM27 million to compensate more than 90 dealers who will be terminated dealers following the rationalisation of the distributorship network with EON.

Plantation stocks would continue to attract interest with the firm crude palm oil prices. CPO futures for third month delivery fell RM20 to RM2,605 per tonne. However, some analysts have cautioned that CPO prices, which recorded its fastest rally in almost seven years, could fall 25% as Infonesia and Malaysia may increase world supplies by 5% this year.

Oil and gas stocks would attract interest, despite a slight decline in the front month delivery, easing to US$57 per barrel.Ramunia would also see trading interest as investors turn more positive about the acquistion of the company by Sime Darby Engineering.

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