MORNING CALL 1 March 2012
FLOWS;
BUYS: Axiata, Unisem, MAS
SELLS: KNM, GentM, Maybank
Technical Stock Alert;
YTLCorp (RM1.75) - Price closed strongly yesterday, reaching a 5 year high on the back of MSCI portfolio rebalancing. Technically its RSI of 74 and MACD divergence is indicating an overbought position where a pull back in the short term is likely, back to around the RM1.60 levels.
PChem (RM6.70) - Approaching support levels of RM6.50 after trending down for the past month after touching a year high of RM7.03. Sell off could be on continued concerns over gas supply issues which could hinder production. RSI down below neutral at 40.81, we don't see much immediate downside. Accumulate as they benefit from higher oil prices.
Stock of the Day
Coastal Contracts (RM2.32)
- Recent full year results met consensus estimates with the company still retaining a strong order book of RM600m.
- Its 100 acre Sabah shipyard is strategically located in Sandakan and could possibly be converted into a O&G fabrication yard to cater for the offshore drilling operations in the state
- The company is also looking at new O&G ventures in Indonesia.
- Price has retraced from a high of RM2.74 after a strong run up in Jan/Feb. The immediate support around the RM2.30 represents a good opportunity to accumulate as it trades at an undemanding PE of 6x.