KUALA LUMPUR: Trading on Bursa Malaysia is likely to be cautious on Tuesday, Sept 27 as external factors continue to weigh heavily on investors’ sentiment as the FBM KLCI fell to the lowest since July 2010 .
However, some reversal of losses at the European markets on Monday on hopes policymakers were putting together a plan to ease the region's debt crisis could ease the selling pressure at the Asian markets.
Stock market data showed the FBM KLCI on Monday closed at its lowest level since July 2010, after persistent foreign selling saw the index fall 2.5% and wiped off RM32.79 billion in market capitalisation.
MIDF Research head Zulkifli Hamzah said the critical support level for the KLCI was 1,275.
“That is the level at which KLCI will complete a 20% retracement from the peak, which heralds a major bear market. At that point, the downside for the market is anybody’s guess,” he said.
Among the stocks to that could be in focus are BANDAR RAYA DEVELOPMENTS BHD [] (BRDB), banks, PLANTATION []s, MULTI-PURPOSE HOLDINGS BHD [], MAGNI-TECH INDUSTRIES BHD [] and YINSON HOLDINGS BHD [].
BRDB called off its proposed sale of four selected assets for RM914 million to its major shareholder Ambang Sehati Sdn Bhd and instead will carry out a tender exercise of the assets.
Banking and plantation-related stocks came under selling pressure yesterday, as continued foreign selling saw the Finance Index on Bursa Malaysia fall 488.93 points to 12,069.62 while the Plantation Index fell 285.20 points to 6,706.96.
MPHB is selling its Menara Multi-Purpose to the Malaysian Chinese Association (MCA) for RM375 million cash, the proceeds from which would be utilised to repay its bank borrowings.
It had entered into a sale and purchase agreement with MCA to sell the office tower together with 414 car park bays. Its original cost of investment in the office tower from 1993 to 1996 and the parking bays in 2004 was a total of RM289.03 million.
MPHB said based on the latest net book value of the PROPERTIES [] as at Dec 31, 2010 of RM175.38 million, the company would have an estimated gain of RM199.62 million from the sale.
As for Magni-Tech, its net profit for the first quarter ended July 31, 2011 jumped 43.7% to RM7.4 million from RM5.15 million a year earlier, attributed to higher garment revenue.
Its revenue for the quarter rose to RM141.71 million from RM116.29 million in 2010, due mainly to increase in sale of garments and packaging goods arising from higher sale orders received.
Yinson net profit for the second quarter ended July 31, 2011 rose 21.8% to RM5.47 million from RM4.49 million a year earlier, driven by its growing marine transport business. Revenue for the quarter increased to RM158.63 million from RM148.54 million in 2010 due to the increase in volume of sales from its trading and marine transport businesses.
The company is also bidding for RM800 million contracts in the marine transport industry in Vietnam, Malaysia and Thailand, while existing orderbook stands at about RM1.25 billion in total.
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