MUI Properties jumps 17.9% to four-month high on soaring gold prices

-A +A

KUALA LUMPUR (July 28): Shares in MUI Properties Bhd (MUI Prop) jumped 17.95% to a four-month high today on the back of soaring gold prices.

At 9.07am, MUI Prop had risen 3.5 sen to 23 sen, with 4.88 million shares traded.

Gold strengthened 2.1% to US$1,942.24 (RM8,257.43) an ounce.

Kenanga Research said MUI Prop is a proxy for soaring gold prices (which have risen 7% in the past week to US$1,940/oz currently, taking the year-to-date [YTD] gain to 28%).

In a technical watch note today, the research house said the stock is a laggard play following sharp share price run-ups for listed jewellers Poh Kong Holdings Bhd and Tomei Consolidated Bhd (up 36% and 52% respectively).

Kenanga said MUI Prop’s exposure to gold is by way of its 40.7% stake in Nex Metals Explorations Ltd, a listed company in Australia which is involved in gold exploration.

It said that on the chart, the stock had been in a range-bound phase after rebounding from a trough of 14.5 sen in March.

“As buying interest returns (the stock was up 8% on strong volume to close at 19.5 sen yesterday), its share price may be on the verge of breaking out from a sideways trading pattern.

“If so, then MUI Prop shares could be on the way to test our resistance thresholds of 24 sen (R1) and 28 sen (R2), which imply upside potential of 23% and 44% respectively.

“Our stop-loss level is pegged at 16 sen (or 18% downside risk),” it said.