KUALA LUMPUR, June 7 — This is a selection of morning calls by local research houses for the day.
From HwangDBS Vickers
Wall Street soared last night. Its key stock indices jumped between 2.3 per cent and 2.4 per cent at the closing bell after European equities rose on hopes that the policy makers would take coordinated steps to stimulate the region’s economic activity.
Still, despite the European Central Bank saying it stands “ready to act” at a meeting yesterday, no concrete action was announced. This may cool down the Asian bourses today following their strong performances yesterday.
Back home, we reckon the FBM KLCI will probably face resistance at the 1,580 level. And after a two-day cumulative gains of 14.2-point for the benchmark index, investors may be searching for market laggards – like MMHE (which is close to securing a contract in Turkmenistan according to media reports), Genting Malaysia, Genting Bhd, MMC Corporation and YTL Power – as trading ideas today.
From RHB Research
Motor – Mar 2012 Quarter Report Card
Motor stocks yielded a mixed set of earnings for 1Q12 reporting season. Of the 5 stocks under coverage, MBM and APM reported headline earnings that were slightly ahead of expectations.
UMW’s 1Q12 results were in line with our expectations but ahead of consensus that remain behind the curve.
Share prices of motor stocks have remained range bound with the exception of UMW which gapped higher post-results. We also see APM’s share price staying resilient given its strong dividend yield potential.
We see auto sales recovering in the months ahead with the normalisation of supply and lenders able to gradually shorten the loan approval process. We see few reasons to revise our neutral view on the sector for now and maintain our TIV forecast of 612,000 units.
The long awaited NAP is unlikely to have a significant impact as most of the key policy thrusts have already been well signalled to the market. UMW is our top pick.
From OSK Research
DAILY TRADING STOCKS: UMW, MAS, UZMA, TCM, YNS, BST, JOHO, COCO
TECHNICAL ANALYZER: HSIF
The index appears to have encountered some difficulties closing below the 18 May “Hammer” low of 18,500 pts in the past 5 days. The lack of continuation in selling is summed up by the 3 rather long-bodied white candles and 2 “Dojis” of Monday and Tuesday. This is likely in reaction to the crowded support zone of 17,550–18,250 pts and the 2½-year daily RSI support level. Nonetheless, the downtrend that started since the false breakout of 21,500 pts back in February is not over. The 4-month series of lower highs is clearly illustrated by the downtrend line and the index is also below the 200-day MAV line.
TECHNICAL ANALYZER: FKLI & FCPO
HOT STOCK: BST - Still Stuck Within A Long-term Sideways Trend
From analyzing Berjaya Sports Toto’s (BST) quarterly chart, it is clear that the stock has been stuck at the RM3.77-RM5.18 trading range since 2007. As the stock is now trading around the middle of this identified range, we do not currently see any great trading opportunities. BST’s long-term technical outlook will remain firmly neutral until either the RM3.77 level or RM5.18 level is violated.
EKC (FV RM4.24 – BUY): Company Update: Banking on Cosway China's Aggressive Expansion Plan
Eng Kah is banking on Cosway’s aggressive expansion plan, particularly in China. Besides benefitting from its joint venture (JV) with Cosway China, the company is anticipating more exports to China. It is also expecting orders from new clients, which were affected by the massive floods in Thailand, to come in by 2HFY12. With 1QFY12 results coming in below expectations, we are revising our FY12 earnings projection downward and introducing our FY13 forecast with a new target price of RM4.24, based on the enlarged share capital post-bonus issue.
* These recommendations are solely the opinion of the respective research firms and not endorsed by The Malaysian Insider. The Malaysian Insider shall not be liable for any loss arising from any investment based on any recommendation, forecast or other information contained here.