（檳城）“我要的並不多，區區200萬令吉就夠了！”、“請給我40萬，40萬而已！”、“我學校的擴建工程就快好了，我們等著給發展商錢，請優先考慮我們！”……
檳州政府今日（週四，1月7日）中午和州內的90所華小及10所國民型中學在光大5樓A視聽室進行交流，以瞭解華教發展事務和商討由州政府制度化撥款的580萬令吉分配事項。但，這個交流會最後卻演變成“討錢大會”，讓檳州首席部長林冠英幾乎招架不來。
10學校擴建要求逾千萬
事緣在這100所華校當中，10所會在今年進行擴建工程，單單這10%的學校，就已向州政府開口要求了共1295萬令吉！問題是州政府的撥款僅580萬，根本連一半都不足，更何況還有其他的90所華校？
面對多所學校要求撥款，林冠英在逐一瞭解詳情後，竟意外發現90%的學校還沒向中央申請，就繞過正規管道，轉向檳州政府求助。
“大家應該以中央政府的撥款為主，畢竟教育是屬於聯邦管轄的範疇，州政府的撥款，你們只能把它當成紅利（Bonus）啊！”
林冠英也解釋，檳州政府的資源畢竟有限，加上之前還因土地案賠償了別人4000萬令吉，能夠撥給學校的實在不多。
輪流上台訴“苦衷”
首長不提還好，一提“向中央申請”的說法之後，學校代表立刻輪流上台說出為何不向中央申請，而向檳州政府要求撥款的理由。
“他們要我們集資了80%的建筑經費後，才接受我們的申請。”
“教育局說，必須在建筑完成後，才可以申請撥款。”
“他們要看到建築後，才行！問題是，如果我們有錢，就不必申請撥款啦！”
校方代表不敢見報
各校代表提出的種種“苦衷”，也讓在場的媒體們目瞪口呆，不過，當攝影記者趨前拍照時，校方代表趕緊阻止，且急得幾乎掉淚的表示：“我們是‘冒險’來跟州政府討撥款的，要是照片登出來，會很麻煩的。你們知道的，我們不方便出現在這裡……”
看到學校代表近乎哀求的陳情後，也在場的檳州行政議員王國慧更是一時忍不住，流下眼淚。
林冠英促勿放棄
“要求中央撥款天公地道”
這項交流會總共進行了2個小時，雖然暫時沒有討論出一個撥款分配的定案，卻帶出了國內華校面對申請撥款時的諸多為難。惟，林冠英呼吁各校代表千萬不要放棄，應該繼續向中央申請。
“雖然他們有很多條例，但你們別管這些執行的公務員，照樣去申請，然後再三不五時的追他們，問他們，只要他們覺得‘煩了’，就會給你了！”
“向政府要錢建學校是天公地道的，這些都是人民的錢，你們絕對有這個權利要求撥款。”
當天出席交流會者，尚包括檳州華教事務協調委員會主席章瑛國會議員、委員黃漢偉州行政議員、許海明、丹斯里陳國平等等。
Thursday, January 7, 2010
Construction sector expected to outperform in 2010
The CONSTRUCTION sector is poised to continue outperforming and could peak in the second half of this year, said HwangDBS Vickers Research.
It said the sector would peak later this year underpinned by the full rollout of three mega projects — the new low-cost carrier terminal, the Pahang-Selangor water transfer project and the Ampang and Kelana Jaya light rail transit (LRT) line extensions.
In addition, foreign contract flows are expected to buoy the sector, with notable markets in the Middle East (ex-Dubai) and India.
Moreover, the outperformance might spill over into 2011, hinging on factors such as the rollout speed of the new Cheras-Damansara LRT line, earnings deliverance, and the pace of new orderbook wins, the research house said in a report yesterday.
"Wildcards are more questionable projects such as the RM48 billion bridge connecting Indonesia, RM28 billion high speed railway and intermodal freight system, RM7 billion bullet train and third link/mass rapid transit (MRT) to Singapore," it said.
HwangDBS Vickers added that the current transition between major national economic blueprints would further boost the sector, as it drew comparisons from the sector's performance at the onset of the Ninth Malaysia Plan (9MP) in 2006.
The 9MP is drawing to a close this year while the 10th Malaysia Plan (10MP) is expected to be tabled in June.
Back in 2006, the trough-to-peak period for the sector was 32 months versus the current 13 months, and the research house said the sector generally outperformed the stock index during this period.
"Price/earnings multiples of our universe also peaked to 40 times versus the current one-year forward average of 14 times," Hwang-DBS Vickers said.
"With the full year of new leadership paving the way for more aggressive contract flows coupled with the still conducive cost environment, we expect further outperformance."
Furthermore, the research house expects private finance initiatives (PFI), off-budget and public-private partnerships to make up for any shortfalls in 10MP development expenditures, anticipated at RM180 billion.
"We also view positively the foreign participation from China contractors for three key local projects, aiding funding woes, hastening the pace of contract awards as well as spillover effects for our local contractors," it said, adding that a precedent was set with the Pahang-Selangor water transfer project and Seremban to Gemas double-tracking project.
One of its sector big-cap picks is IJM CORPORATION BHD [], due to:
1. i) its modus operandi of bidding for a large pool of contracts giving it the highest probability of orderbook replenishment;
2. ii) strong beneficiary of move to an open tender system; and
3. iii) diversified earnings base.
"We also like MRCB (MALAYSIAN RESOURCES CORP []oration Bhd) given its scarcity premium as a GLC listed contractor and we think its proposed one-for-two rights issue is a precursor to sizeable government land deal.
"Given its success with KL Sentral and strong shareholder backing from the Employees Provident Fund (EPF), we are confident that this will come to fruition," it said.
The research house also picked GAMUDA BHD [] and SUNWAY HOLDINGS BHD [] as big-cap and small-cap options, respectively.
It said the sector would peak later this year underpinned by the full rollout of three mega projects — the new low-cost carrier terminal, the Pahang-Selangor water transfer project and the Ampang and Kelana Jaya light rail transit (LRT) line extensions.
In addition, foreign contract flows are expected to buoy the sector, with notable markets in the Middle East (ex-Dubai) and India.
Moreover, the outperformance might spill over into 2011, hinging on factors such as the rollout speed of the new Cheras-Damansara LRT line, earnings deliverance, and the pace of new orderbook wins, the research house said in a report yesterday.
"Wildcards are more questionable projects such as the RM48 billion bridge connecting Indonesia, RM28 billion high speed railway and intermodal freight system, RM7 billion bullet train and third link/mass rapid transit (MRT) to Singapore," it said.
HwangDBS Vickers added that the current transition between major national economic blueprints would further boost the sector, as it drew comparisons from the sector's performance at the onset of the Ninth Malaysia Plan (9MP) in 2006.
The 9MP is drawing to a close this year while the 10th Malaysia Plan (10MP) is expected to be tabled in June.
Back in 2006, the trough-to-peak period for the sector was 32 months versus the current 13 months, and the research house said the sector generally outperformed the stock index during this period.
"Price/earnings multiples of our universe also peaked to 40 times versus the current one-year forward average of 14 times," Hwang-DBS Vickers said.
"With the full year of new leadership paving the way for more aggressive contract flows coupled with the still conducive cost environment, we expect further outperformance."
Furthermore, the research house expects private finance initiatives (PFI), off-budget and public-private partnerships to make up for any shortfalls in 10MP development expenditures, anticipated at RM180 billion.
"We also view positively the foreign participation from China contractors for three key local projects, aiding funding woes, hastening the pace of contract awards as well as spillover effects for our local contractors," it said, adding that a precedent was set with the Pahang-Selangor water transfer project and Seremban to Gemas double-tracking project.
One of its sector big-cap picks is IJM CORPORATION BHD [], due to:
1. i) its modus operandi of bidding for a large pool of contracts giving it the highest probability of orderbook replenishment;
2. ii) strong beneficiary of move to an open tender system; and
3. iii) diversified earnings base.
"We also like MRCB (MALAYSIAN RESOURCES CORP []oration Bhd) given its scarcity premium as a GLC listed contractor and we think its proposed one-for-two rights issue is a precursor to sizeable government land deal.
"Given its success with KL Sentral and strong shareholder backing from the Employees Provident Fund (EPF), we are confident that this will come to fruition," it said.
The research house also picked GAMUDA BHD [] and SUNWAY HOLDINGS BHD [] as big-cap and small-cap options, respectively.
Wednesday, January 6, 2010
January Indicator: A First Day Rally Is Positive Sign for Stocks
If the stock market holds to a pattern it has followed for most of the past 40 years, 2010 could be a big year for investors.
Since 1973, a big advance on the first trading day of January has been a strong sign stocks will post robust gains for the rest of the year.
On Monday, upbeat news about manufacturing lifted the Dow Jones industrial average 155 points, or 1.5 percent. The Standard & Poor's 500 index rose 17 points, or 1.6 percent.
When the S&P 500 has gained more than 1 percent on the first day of trading, the index has ended the year higher 86 percent of the time, according to Schaeffer's Investment Research.
After a big first day, the average yearly gain in the S&P 500 index has been 14.7 percent. That's important because the index is the yardstick for the overall market and for many investments such as mutual funds.
Still, trying to predict the year based on the first day of trading is dicey.
Over the past 20 years, the S&P 500's first-day move regardless of its size correlated with how the index finished the year just 11 times. Six of those years saw the market advance, while five saw it slide.
And as investors are well aware, there are plenty of potential obstacles that could pull the market back down, including Friday's December employment report from the Labor Department.
Other threats include the struggling real estate market and expectations of rising interest rates.
Analysts agree that the huge gains of 2009—when the S&P 500 index jumped 64.8 percent in nine months to end the year with a gain of 23.5 percent—have almost no chance of being
After such a huge run in 2009, some market watchers believe lingering questions about the economy could trigger a correction, which is generally considered a drop of at least 10 percent.
But for those who believe "as January goes in the stock market, so goes the rest of the year," the first trading day of 2010 is a good omen.
China's manufacturing industry posted the fastest growth in 20 months for December, while a trade group of purchasing executives said demand at U.S. factories was increasing. The Institute for Supply Management's index of manufacturing activity rose to 55.9 from 53.6 in November, a bigger improvement than analysts predicted.
The market may also have rallied Monday based on what's known as the "January effect," the buying spurt that often occurs with the start of a new tax year.
Investors who sold stock before the end of the old year to claim a tax loss reinvest that money when trading begins again.
According to the "Stock Trader's Almanac," a book that tracks market trends, there have been only five times since 1950 when the January effect turned out to be a poor indicator of the rest of the year.
The stock market barreled higher in 2009 in part because the big banks at the heart of the 2008 financial crisis started making money again. But much of their ability to do so was dependent on the Federal Reserve, which helped them out with ultra-low borrowing costs.
Investors are uncertain how banks and the rest of the economy will fare as policymakers begin to withdraw some of those emergency supports from the economy this year.
David Kelly, chief market strategist at J.P. Morgan Funds, is looking first at jobs, not statistics, to determine whether the market can hold and even build on the steep advance of 2009.
"The crucial last checkmark on the clipboard of economic recovery is employment," Kelly said.
If unemployment remains at 10 percent, it will be hard for consumer spending to increase and that's what drives the economy.
"Jobs, from an economic psychology point of view, are kind of the holy grail. A lot of people in America don't believe the economy is recovering," Kelly said.
The next major snapshot of the job market comes Friday, when the Labor Department is scheduled to release its employment figures for December.
It is already the biggest report on investors' calendar each month but this one will set the tone for trading in 2010.
Economists forecast that employers cut 23,000 jobs in December, according to a survey by Thomson Reuters. In November, the number of jobs lost came to 11,000 jobs, far fewer than anticipated.
Kelly said a gain in jobs, when it occurs, could send a jolt through the markets.
"That will deal a body-blow to pessimism," he said.
Beyond the worries about the economy, there is a danger that greed could lead the market astray, as it did when the S&P 500 and the Dow reached their peak in October 2007.
The S&P 500 index is still down by 27.6 percent from its high, while the Dow is still down 25.3 percent.
Jeffrey Frankel, president of Stuart Frankel & Co. in New York, is concerned that everyday investors who missed the strong run in 2009 are now charging into the market.
"People sat around the holiday table and those that had money in cash and those that had money in bonds had to listen to people that had money in funds," Frankel said. "Unfortunately that leads to people kind of following the crowd."
Since 1973, a big advance on the first trading day of January has been a strong sign stocks will post robust gains for the rest of the year.
On Monday, upbeat news about manufacturing lifted the Dow Jones industrial average 155 points, or 1.5 percent. The Standard & Poor's 500 index rose 17 points, or 1.6 percent.
When the S&P 500 has gained more than 1 percent on the first day of trading, the index has ended the year higher 86 percent of the time, according to Schaeffer's Investment Research.
After a big first day, the average yearly gain in the S&P 500 index has been 14.7 percent. That's important because the index is the yardstick for the overall market and for many investments such as mutual funds.
Still, trying to predict the year based on the first day of trading is dicey.
Over the past 20 years, the S&P 500's first-day move regardless of its size correlated with how the index finished the year just 11 times. Six of those years saw the market advance, while five saw it slide.
And as investors are well aware, there are plenty of potential obstacles that could pull the market back down, including Friday's December employment report from the Labor Department.
Other threats include the struggling real estate market and expectations of rising interest rates.
Analysts agree that the huge gains of 2009—when the S&P 500 index jumped 64.8 percent in nine months to end the year with a gain of 23.5 percent—have almost no chance of being
After such a huge run in 2009, some market watchers believe lingering questions about the economy could trigger a correction, which is generally considered a drop of at least 10 percent.
But for those who believe "as January goes in the stock market, so goes the rest of the year," the first trading day of 2010 is a good omen.
China's manufacturing industry posted the fastest growth in 20 months for December, while a trade group of purchasing executives said demand at U.S. factories was increasing. The Institute for Supply Management's index of manufacturing activity rose to 55.9 from 53.6 in November, a bigger improvement than analysts predicted.
The market may also have rallied Monday based on what's known as the "January effect," the buying spurt that often occurs with the start of a new tax year.
Investors who sold stock before the end of the old year to claim a tax loss reinvest that money when trading begins again.
According to the "Stock Trader's Almanac," a book that tracks market trends, there have been only five times since 1950 when the January effect turned out to be a poor indicator of the rest of the year.
The stock market barreled higher in 2009 in part because the big banks at the heart of the 2008 financial crisis started making money again. But much of their ability to do so was dependent on the Federal Reserve, which helped them out with ultra-low borrowing costs.
Investors are uncertain how banks and the rest of the economy will fare as policymakers begin to withdraw some of those emergency supports from the economy this year.
David Kelly, chief market strategist at J.P. Morgan Funds, is looking first at jobs, not statistics, to determine whether the market can hold and even build on the steep advance of 2009.
"The crucial last checkmark on the clipboard of economic recovery is employment," Kelly said.
If unemployment remains at 10 percent, it will be hard for consumer spending to increase and that's what drives the economy.
"Jobs, from an economic psychology point of view, are kind of the holy grail. A lot of people in America don't believe the economy is recovering," Kelly said.
The next major snapshot of the job market comes Friday, when the Labor Department is scheduled to release its employment figures for December.
It is already the biggest report on investors' calendar each month but this one will set the tone for trading in 2010.
Economists forecast that employers cut 23,000 jobs in December, according to a survey by Thomson Reuters. In November, the number of jobs lost came to 11,000 jobs, far fewer than anticipated.
Kelly said a gain in jobs, when it occurs, could send a jolt through the markets.
"That will deal a body-blow to pessimism," he said.
Beyond the worries about the economy, there is a danger that greed could lead the market astray, as it did when the S&P 500 and the Dow reached their peak in October 2007.
The S&P 500 index is still down by 27.6 percent from its high, while the Dow is still down 25.3 percent.
Jeffrey Frankel, president of Stuart Frankel & Co. in New York, is concerned that everyday investors who missed the strong run in 2009 are now charging into the market.
"People sat around the holiday table and those that had money in cash and those that had money in bonds had to listen to people that had money in funds," Frankel said. "Unfortunately that leads to people kind of following the crowd."
Friday, December 25, 2009
Thursday, December 24, 2009
Seven-time champion Schumacher eyes record eighth F1 title
Michael Schumacher targeted an unprecedented eighth Formula One title after Mercedes announced yesterday he was coming out of retirement to race for them at the age of 41.
“Our aim can only be to fight for the championship,” the German told reporters in a conference call after signing a contract on Tuesday.
Media reports have suggested the German, who won his titles with Benetton and Ferrari and retired at the end of 2006, will earn €7mil (US$10mil) in what would be an all-German line-up.
“We are talking about a three-year deal, it’s not just a one-off thing,” said the former Ferrari ace of a contract that had been expected to be for just one year. “We are looking for continuation.”
Mercedes, who have taken over champions Brawn GP, have signed Nico Rosberg as their other driver for 2010. World champion Jenson Button has left the British-based team for McLaren.
A move to Mercedes will give Schumacher, who turns 41 in January, a potentially winning car and reunite him with Britain’s Ross Brawn - the technical director who guided him to all his titles and who is now the team principal.
It will also take Schumacher’s career full circle, since the German drove for the Mercedes sportscar team before breaking into Formula One with Jordan in 1991.
“I am happy to be able to give something back that Mercedes gave in the early days,” Schumacher said.
Schumacher had planned a comeback with Ferrari earlier this year as a stand-in for injured Brazilian Felipe Massa but had to abandon that idea due to a neck injury caused by a motorcycle accident.
Since his retirement, the German has worked as a consultant for Ferrari but the Italian team has said that is not a binding agreement.
Schumacher will be returning to a very different, and more cost-conscious, Formula One from the series he left after a record 91 wins from 249 starts.
Mercedes and Ferrari will be the only fully manufacturer-owned teams, with BMW, Honda and Toyota having all left in the past year and Renault due to sell a significant stake in their British-based operation.
Schumacher will be hoping to emulate the likes of Austrian Niki Lauda and France’s Alain Prost, champions who both came back to win titles after time out of Formula One.
Former champions Damon Hill, Schumacher’s leading rival in the mid 1990s, and Nigel Mansell have both said that age will be no impediment and that the German could return as a winner.
“It wouldn’t surprise me if Michael challenged for another world championship,” Britain’s 1992 champion Mansell, who won his title aged 39 and competed in Formula One until the age of 41, said at the weekend.
Schumacher’s return will allow 2008 champion Lewis Hamilton, who entered the sport only after Schumacher retired, to measure himself against Formula One’s most successful driver while also setting up an intriguing Anglo-German battle.
Hamilton and 2009 champion and compatriot Button will form an all-English pairing at rivals McLaren, who will still be powered by Mercedes engines.
There will also be a battle of the generations, with Schumacher lining up on a starting grid likely to include at least one driver half his age.
The sport’s oldest champion remains the late Argentine Juan Manuel Fangio, who took his fifth title at the age of 46. The oldest driver to win a grand prix is Italian Luigi Fagioli in 1951 at the age of 53. — Reuters
The Schumacher fact file
Name: Michael Schumacher
Date of birth: Jan 3, 1969
Birthplace: Kerpen, Germany
Height: 1.74m
Weight: 74kg
Wife: Corinna (married August 1995); children - Gina Maria, Mick
n Career details
Starts: 250;
Victories: 91
Poles: 68
Fastest Laps: 72
Points: 1,369
Grand Prix debut: 1991, Belgian GP, Jordan
Teams: Jordan (1991), Benetton (1991-1995), Ferrari (1996-2006)
World champion: 1994, 1995, 2000, 2001, 2002, 2003, 2004
Property tax let-off for owners
PUTRAJAYA: The real property gains tax (RPGT) announced during the Budget 2010 will only apply to properties sold within five years of their purchase, announced Datuk Seri Najib Tun Razak.
The Prime Minister said the 5% tax would now only be paid if the property was sold within five years of its purchase instead of the tax being imposed on the sale of property regardless how long its owners hold on to it as initially announced in the Budget.
He said the decision would see the Government forgoing revenue amounting to RM200mil, adding the move was made following requests by the Federation of Chinese Associations of Malaysia (Hua Zong) and the business sector.
“This policy was also decided upon as the Government wants to see stronger growth in the property sector next year. We are even willing to forgo a substantial revenue so that the sector can expand and grow.
“The property sector has shown signs of improvement but we feel that it requires further impetus so that it can continue to grow from strength to strength.
“We have met one of Hua Zong’s requests and we hope they will respond accordingly by working even closer with the Government in the future,” Najib said at the swearing-in ceremony of Hua Zong’s office bearers for the 2009-2011 term on Wednesday night.
Also present were Transport Minister Datuk Seri Ong Tee Keat, Health Minister Datuk Seri Liow Tiong Lai, Deputy Education Minister Datuk Dr Wee Ka Siong, Deputy Youth and Sports Minister Datuk Wee Jeck Seng and Hua Zong president Tan Sri Pheng Yin Huah.
Najib also announced that hotels undertaking additional investments to renovate, refurbish and expand their premises would enjoy a 60% re-investment allowance that has now been extended to 15 years from the previous 10 years.
He said this was an attempt to boost the country’s robust tourism industry, which has tremendous potential for further growth.
Najib also said that he wanted to see a more “active” private sector, which he said had been rather “lethargic” and had been more interested in investing abroad rather than domestically.
Tuesday, December 22, 2009
Gamuda 1Q earnings up 14.5% to RM63m
GAMUDA BHD posted stronger set of earnings in the first quarter ended Oct 31, with net profit at RM63 million, up 14.5% from RM55.04 million a year ago, due to higher contributions from all divisions.
The infrastructure-based company said on Tuesday, Dec 22 that revenue was marginally higher by 1.63% at RM623.96 million from RM613.96 million.
The infrastructure-based company said on Tuesday, Dec 22 that revenue was marginally higher by 1.63% at RM623.96 million from RM613.96 million.
Earnings per share were 3.13 sen versus 2.74 sen. It also declared a dividend of 6.0 sen per share compared with 4.0 sen a year ago.
Gamuda said for 1Q under review, the pre-tax profit of RM83.5 million was higher than the preceding quarter's profit before tax of RM80.4 million, "primarily due to higher contribution from the property division arising from strong property sales with effect from the middle of the last financial year".
On the prospects, it said with existing CONSTRUCTION [] projects progressing on schedule and the recovery of the property market, the group's performance is expected to improve in the remaining quarters of the current financial year.
On the Electrified Double Track project, it said work progress was behind schedule due to delays in design approval and late handover of land by the authorities.
"Under the terms of the contract signed by the Government of Malaysia and the project company, all land should be handed over to the project company early this year, but to-date, only 90% has been handed over.
"As a result of the delays, on Nov 9, 2009, the government granted the project company an interim extension of time of 11 months to complete the project. The project completion date is now revised from January 2013 to December 2013. The work progress is expected to pick up in the remaining quarters of the financial year," it said.
As for the New Doha International Airport project in Qatar, Gamuda said progress claims submitted to the Qatari government are being settled within the contractual period. It added the project was progressing on
schedule.
On the Yenso Park and sewage treatment plant projects in Vietnam, it said they were progressing well. The recent devaluation of the Vietnamese dong has no significant near term impact on the group.
Wednesday, December 2, 2009
Palm oil set to rise 'sharply' in 2010
Palm oil prices are poised to rise “sharply” next year as demand remains robust amid potential supply disruptions from El Nino, according to Dorab Mistry, director of Godrej International Ltd.
“Production has peaked this year and we’re entering the seasonal low-production period,” Mistry said in an interview in Bali, Indonesia today. “The bigger concern is the coming El Nino, which will affect production in the second half of 2010.”
Consumption in China and India, the two biggest importers of edible oils, is increasing and “rising from an already high base,” Mistry said. Godrej is the biggest edible oils supplier to India. Indonesia and Malaysia produce about 90 per cent of the world’s supply.
Mistry, who correctly predicted last month that palm oil futures would reach RM2,400 a metric ton by the first quarter of 2010, said prices may even climb as high as RM3,000 by the end of next year if crude oil advances to US$100 a barrel. He will issue another price forecast on Dec. 4, he said.
The most-active contract closed at a 15-week high of RM2,495 yesterday and traded at RM2,490 at the 12:30 p.m. trading break on the Malaysia Derivatives Exchange.
Palm oil, used in cooking and fuel, has climbed 47 per cent this year as crude oil gained 76 per cent and rains and freezing weather threatened harvesting of the soybean crop in the US, the biggest producer, potentially reducing output of rival soybean oil. -- Bloomberg
“Production has peaked this year and we’re entering the seasonal low-production period,” Mistry said in an interview in Bali, Indonesia today. “The bigger concern is the coming El Nino, which will affect production in the second half of 2010.”
Consumption in China and India, the two biggest importers of edible oils, is increasing and “rising from an already high base,” Mistry said. Godrej is the biggest edible oils supplier to India. Indonesia and Malaysia produce about 90 per cent of the world’s supply.
Mistry, who correctly predicted last month that palm oil futures would reach RM2,400 a metric ton by the first quarter of 2010, said prices may even climb as high as RM3,000 by the end of next year if crude oil advances to US$100 a barrel. He will issue another price forecast on Dec. 4, he said.
The most-active contract closed at a 15-week high of RM2,495 yesterday and traded at RM2,490 at the 12:30 p.m. trading break on the Malaysia Derivatives Exchange.
Palm oil, used in cooking and fuel, has climbed 47 per cent this year as crude oil gained 76 per cent and rains and freezing weather threatened harvesting of the soybean crop in the US, the biggest producer, potentially reducing output of rival soybean oil. -- Bloomberg
HwangDBS: Bursa set to see return of foreign funds
MALAYSIA'S stock market is likely to see the return of foreign funds, especially if global equities turn increasingly volatile ahead, says HwangDBS Vickers Research Sdn Bhd(HDBSVR).
The foreign research firm said as the risk-reward profile tilts to the opposite direction because of stretched valuations, strategists may be tempted to make a gradual tactical switch to more defensive low-beta markets like Malaysia to diversify their risks.
The prospect of an appreciating ringgit is an added appeal for investors in search of incremental investment returns.
HDBSVR said even though Malaysian stocks remain unexciting from a broad valuation perspective, there are "hidden gems" to be found using a bottom-up approach.
These are fundamentally under-valued stocks that were once favourites of foreign investors, but are now under-owned by them.
"Combing through our 'buy' list of big and mid-cap companies, under-owned stocks - with foreign shareholdings far below their recent peaks - that could increasingly come under the investment radar of foreign investors again are CIMB (with 33 per cent foreign shareholding as of end-June 2009 versus a peak of 54 per cent), IJM Corp (34 per cent vs 62 per cent), MRCB (19 per cent vs 44 per cent), SP Setia (28 per cent vs 56 per cent) and Tenaga (11 per cent vs 28 per cent)," it said in a market focus report titled "What foreigners want" yesterday.
Additional counters currently rated "buy" by the research firm that can increasingly gain traction among foreign investors again include Gamuda (45 per cent foreign shareholding in June 2009), Genting (44 per cent), Genting Malaysia (33 per cent), Hong Leong Bank (7 per cent), Proton (16 per cent), Public Bank (25 per cent) and RHB Capital (5 per cent).
HDBSVR noted that foreign investors were conspicuously absent from the scene when the Malaysian stock market jumped 51 per cent from a trough of 836 in mid-March 2009 to now.
"This was evident in the insignificant level of trading activity by foreign investors (just 25 per cent of trading value in January-September 2009) and the persistent net portfolio investment quarterly outflows (since third quarter of 2007) with foreign ownership standing at a five-year low."
Foreign ownership - standing at 21 per cent of overall market capitalisation as of September 2009 - is also at its lowest in five years.
The foreign research firm said as the risk-reward profile tilts to the opposite direction because of stretched valuations, strategists may be tempted to make a gradual tactical switch to more defensive low-beta markets like Malaysia to diversify their risks.
The prospect of an appreciating ringgit is an added appeal for investors in search of incremental investment returns.
HDBSVR said even though Malaysian stocks remain unexciting from a broad valuation perspective, there are "hidden gems" to be found using a bottom-up approach.
These are fundamentally under-valued stocks that were once favourites of foreign investors, but are now under-owned by them.
"Combing through our 'buy' list of big and mid-cap companies, under-owned stocks - with foreign shareholdings far below their recent peaks - that could increasingly come under the investment radar of foreign investors again are CIMB (with 33 per cent foreign shareholding as of end-June 2009 versus a peak of 54 per cent), IJM Corp (34 per cent vs 62 per cent), MRCB (19 per cent vs 44 per cent), SP Setia (28 per cent vs 56 per cent) and Tenaga (11 per cent vs 28 per cent)," it said in a market focus report titled "What foreigners want" yesterday.
Additional counters currently rated "buy" by the research firm that can increasingly gain traction among foreign investors again include Gamuda (45 per cent foreign shareholding in June 2009), Genting (44 per cent), Genting Malaysia (33 per cent), Hong Leong Bank (7 per cent), Proton (16 per cent), Public Bank (25 per cent) and RHB Capital (5 per cent).
HDBSVR noted that foreign investors were conspicuously absent from the scene when the Malaysian stock market jumped 51 per cent from a trough of 836 in mid-March 2009 to now.
"This was evident in the insignificant level of trading activity by foreign investors (just 25 per cent of trading value in January-September 2009) and the persistent net portfolio investment quarterly outflows (since third quarter of 2007) with foreign ownership standing at a five-year low."
Foreign ownership - standing at 21 per cent of overall market capitalisation as of September 2009 - is also at its lowest in five years.
Corporate earnings recovery gains momentum
The recovery in Malaysian corporate earnings is gaining momentum, analysts said, pointing to the better-than-expected slew of financial results that came in for the third quarter of this year.
The recently concluded financial reporting season, like the previous season, surprised analysts on the upside.
According to RHB Research Institute Sdn Bhd, the bulk (83.8 per cent) of the corporate results that it covered came in either within or above its expectations. A similar picture was reflected in the consensus numbers.
"This suggests that there is still room for earnings upside surprises in the quarters ahead as the economic recovery gains momentum, even though it may not be as significant relative to what we have seen during the past two quarters," it said in a note to clients yesterday.
The number of companies whose earnings it upgraded exceeded the downgrades, as was the case in the previous quarter. Only 16 of the 99 companies that it covered turned in worse-than-expected earnings.
OSK Research Sdn Bhd, meanwhile, said that its preliminary analysis of the third quarter results season indicated that it was "a very strong results season" as the upgrade to downgrade ratio reached multi-year highs.
The banking sector stood out as the top performer this season, while plantation disappointed the most.
"More companies are reporting better margins as a result of improving demand, better product mix and lower operating expenses on the back of the implementation of cost-cutting measures," RHB noted.
Despite the better report card, RHB kept its year-end target for the FBM KLCI unchanged at 1,260 points, citing near-term external uncertainties. The stock market benchmark index closed higher than that yesterday, at 1,266.71.
It, however, raised the index target for next year to 1,370 from 1,345 before.
OSK, in a report yesterday, said December would be a good time to invest in Malaysian stocks.
It pointed out that since 1996, the index has posted an average 3.96 per cent gain 85 per cent of the time in the last month of the year, reaffirming a long-held belief of window-dressing at the year-end.
A similar gain this month would take the index to the 1,308.97-level, in line with OSK's view of a 1,345 fair value next year.
The recently concluded financial reporting season, like the previous season, surprised analysts on the upside.
According to RHB Research Institute Sdn Bhd, the bulk (83.8 per cent) of the corporate results that it covered came in either within or above its expectations. A similar picture was reflected in the consensus numbers.
"This suggests that there is still room for earnings upside surprises in the quarters ahead as the economic recovery gains momentum, even though it may not be as significant relative to what we have seen during the past two quarters," it said in a note to clients yesterday.
The number of companies whose earnings it upgraded exceeded the downgrades, as was the case in the previous quarter. Only 16 of the 99 companies that it covered turned in worse-than-expected earnings.
OSK Research Sdn Bhd, meanwhile, said that its preliminary analysis of the third quarter results season indicated that it was "a very strong results season" as the upgrade to downgrade ratio reached multi-year highs.
The banking sector stood out as the top performer this season, while plantation disappointed the most.
"More companies are reporting better margins as a result of improving demand, better product mix and lower operating expenses on the back of the implementation of cost-cutting measures," RHB noted.
Despite the better report card, RHB kept its year-end target for the FBM KLCI unchanged at 1,260 points, citing near-term external uncertainties. The stock market benchmark index closed higher than that yesterday, at 1,266.71.
It, however, raised the index target for next year to 1,370 from 1,345 before.
OSK, in a report yesterday, said December would be a good time to invest in Malaysian stocks.
It pointed out that since 1996, the index has posted an average 3.96 per cent gain 85 per cent of the time in the last month of the year, reaffirming a long-held belief of window-dressing at the year-end.
A similar gain this month would take the index to the 1,308.97-level, in line with OSK's view of a 1,345 fair value next year.
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