FBM30 1519.36, +10.3 points (+0.68%), Volume 1,443.9mil, Value 1,787mil
1) A slightly-better-than-expected 4Q growth in China (8.9% vs cons 8.7%) eased fears of a hard landing and bolstered expectations of easier monetary policy igniting some buying interest which kept the key regional markets firmer (HSI+3.2%, STI+2.2%, SHCOMP+4.2%), including KLCI. Gains in select blue chips (GENTING+4.2%, UEMLAND+2.2%, TENAGA+1.8%, AMMB+1.4%) pushed the index higher in the afternoon session to offset yesterday's losses. Market focus was on Proton(+4.4%) as Khazanah announced it was divesting its 42.72% Proton stake to DRBHicom(-3.2%) for RM5.50/share or RM1.291bn cash. Broader market was healthy with advancers outpacing decliners 433:330. Futures closed 1522(3pt premium)
2) Heavyweights: GENTING+4.2% RM11.00, MAYBANK+1.2% RM8.29, TENAGA+1.8% RM6.23, PCHEM+1.2% RM6.51, AMMB+1.4% RM5.84, PBBANK+0.3% RM13.18, KLK+1.1% RM24.64, SIME+0.2% RM9.10, CIMB-0.4% RM7.16, MMCCORP-1.8% RM2.68
3) DBT: MENANG 10mil @ RM0.23, Y&G 7mil @ RM1.00, FUTUTEC 3.5mil @ RM0.60
4) Situationals:
DAYANG-2.6% RM1.89: Shares gained as much as 2.1% (RM1.98) before profit taking set in after company's unit DESB Marine Services Sdn Bhd has received a letter of award from Nautika Sdn Bhd for the extension of time charter of its work boat to Brunei Shell Petroleum Company Sdn Bhd. Dayang said the contract extensions will be effective from March 1, 2012 until Oct 31, 2016, and is valued at about RM85m.
5)TNB - 1Q11/11 rslts T/over RM8.7bn +13%, Net loss RM224.7m v RM716.5m profit, EPS (4.1sen)
Annualised concensus RM2.6bn, 48.9sen (ex EI forex loss still 70% below cons)
Turnover improved driven by higher elect demand in P. Msia of 3.9% and elect sales grew 0.8% qoq. QoQ rslts showed imporovement as recorded lower loss compared to previous 4Q11 (RM453m) although operating expenses increased 29% (yoy) on continued usage of oil and distillate resulting in 76% lower (yoy) operating prof of RM297.5m. EBITDA margin was lower at 15.1% against 28.5% in 1Q11 from higher usage of alternative fuels. Co recorded forex loss of RM420m v (RM106m) previously as USD, Yen strengthened against RM this qtr.
Outlook for the year remains challenging despite expectations of electricity demand growth of 4-5% as generation cost.
Comment: Expectations of easing coal prices as demand from China slows, Melaka regassification plant coming onstream by Jul this year will ease cost generation pressure as well as possible rerating catalyst upon resolution of tariff rebalancing review. BOW
6) Mkt - continue to trade rangebound as buying interest rotates amongst sectors and stocks. Any weakness is a buying opportunity for Pos, MAS, Sime, TNB, MISC.
