Bad news for Comfort Gloves pushes competitors higher

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KUALA LUMPUR (April 6): Glove counters on the local bourse advanced in morning trade today, as investors learned of the negative news surrounding Perak-based nitrile and latex glove manufacturer Comfort Gloves Bhd.

Among glove players listed on Bursa Malaysia, Hartalega Holdings Bhd gained as much as 21 sen or 3.5% so far to RM6.25, with a total of 557,200 shares done as at 11.30 am.

Meanwhile, Top Glove Corp Bhd rose 20 sen or 2% this morning to RM10.10, before settling at RM9.99 after 1.55 million shares were traded.

Mid-small caps Supermax Corp Bhd and Karex Bhd were unchanged at the time of writing, after edging up eight sen and half a sen earlier in the session, respectively.

Speculations are that these glove players may benefit from a possible disruption in competitor Comfort Gloves' business, SJ Securities Sdn Bhd senior remisier Goh Kay Chong told theedgemarkets.com.

"Technical charts are showing that bankers and funds are in Hartalega and Top Glove. It seems investors and fund managers have entered these two stocks thinking that they may benefit from Comfort Gloves' episode," he said.

A check on the regulator's website revealed that Comfort Gloves' wholly-owned Comfort Rubber Gloves Industries Sdn Bhd has been included in the US Food and Drug Administration's alert list on March 15.

Until and unless Comfort Gloves presents evidence that shipments are not adulterated, its business could be affected, Goh added.

Shares in Comfort Gloves tumbled for seven consecutive days to finish at 70 sen as at yesterday's closing. The stock bounced back this morning, gaining 4.5 sen or 6.43% to 74.5 sen at press time.