FBM30 1579.38 +3.67 points (+0.23%) Volume 1,360mil Value 1,731mil
1) Market traded in a 5 points range as region ended mixed after China saw a drop in foreign investment adding to concerns that a slowdown in China’s economy will worsen. Investors were also cautious ahead of US job and manufacturing numbers. Index closed at day’s high aided by gain in CIMB+2%. However broader market turned negative with losers leading gainers 443:296. Futures closed 1582 (3 points premium).
2) Heavyweights: CIMB+2.3% RM7.57, MAYBANK+0.69% RM8.76, YTL+4.05% RM1.80, AXIATA+0.59% RM5.15, PETGAS-2.24% RM16.60, DIGI-1.27% RM3.90, GENTING-0.55% RM10.80, PBBANK-0.3% RM13.66
3) DBT: PERMAJU 7mil @ RM0.30 (3.6% PUC), RPB 5.6mil @ RM0.385 (12.5% discount)
4) Situationals:
REDTONE+3.85% RM0.27: TM will be providing the HSBB access and HSBB Transmission services to REDTONE whereby REDTONE will have access to all 1.3 million premises covered by the HSBB services nationwide. The HSBB access will provide REDTONE the opportunity to widen its service offerings to the small and medium enterprise segment.
5) TOPGLOVE
1H Feb 2012 Tover +13% RM1.1bn Net +38.1% RM84.90m 13.7sen 6.7% above cons(f) RM159.1m
The improved performance was attributed to an increase in glove demand, improved operational efficiency and a downtrend in latex prices which reduced from an average of RM8.14/kg in 1HFY11 to RM7.58/kg in 1HFY12. 2Qtr recovery in the USD also helped in the improve qtr numbers. Latex prices are expected to stay above RM7 per kg in the short term due to the Thai government’s intervention to support rubber prices coupled with the wintering season from February to May 2012. Continued volatility in foreign exchange market is expected, however existing hedges should provide reasonable protection through to 2HFY12.
Net cash was maintained at RM302 million as of February 29, 2012 despite utilising some cash for our capital expenditure for new factories and the recent dividend payment.
Comments: Continues to trade at a premium to the sector although valuations are now more reasonable at the high teens PE vs above 20x. HOLD
6) Market – Current range bound trading to continue due to domestic uncertainties. Stocks back down to low end of trading range UEMLand, KNM, MRCB, Muhibbah.
