Petronas not selling subsidised gas to Tenaga this year

KUALA LUMPUR (March 5): Petroliam Nasional Bhd (Petronas) has reiterated that it will not continue selling subsidised gas to TENAGA NASIONAL BHD [] (TNB) for electricity generation this year.

Its president and chief executive, Datuk Shamsul Azhar Abbas said the offer was supposed to be a "one-off" affair and the government should not pay for any subsidy on gas.

"Never had we mentioned in the past that its going to be continuous handout to TNB... It was supposed to be one-off, because we pity them as they don't have enough cash at that time.

"As a member of the economic council, we have volunteered to help them out and the government has also volunteered to play its part as well," he told reporters after announcing Petronas' 2011 financial performance here.

Currently, Petronas still waiting to get feedback from Putrajaya on its offer to foot a third of the cost to supply gas to TNB in order to help the consumers.

Shamsul Azhar said that for every RM3.00 subsidy, it would cost the group some RM1.7 billion.

"We sat down with three ministers three weeks ago and we’ve basically proposed a review of the formula, which takes into account domestic sensitivities.

"So, now it’s up to them to bring it up to the Economic Council," he said.

Petronas currently provides subsidies of up to RM20 billion per year to the power industry in the form of natural gas at rates below market prices.

The company disclosed that it had paid RM108.5 billion in subsidies for TNB since 1997, including RM3.9 billion for the three quarters ended Dec 31, 2011.



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Blue chips extend gains, CIMB, Sime lead again

KUALA LUMPUR (March 5): Bursa Malaysia closed higher on Monday on gains in selected blue-chips, dealers said.

The FBM KLCI was set to break the all-time high of 1,594.74 earlier when it reached 1,594.72 but it retreated to close at 1,589.22, up 5.44 points.

A dealer said although the market failed to make a breakthrough the momentum has been set for it to further move up and try break the resistance in the near term.

"At the moment, interest was very focused on selective blue-chips without an preference for any particular group," he said.

The Finance Index jumped 74.72 points to 14,204.47. The PLANTATION [] Index dropped 16.44 points to 8,661.77 and the INDUSTRIAL INDEX [] was 8.23 points lower at 2,918.54. The FBM Emas Index rose 27.721 points to 10,974.61 and the FBMT100 increased 26.88 points to 10,758.28.

Advancers led decliners by 391 to 325 while 414 counters were unchanged, 365 untraded and 20 suspended. Total volume declined to 1.448 billion shares valued at RM1.760 billion from 1.630 billion shares valued at RM1.934 billion last Friday.

Among active stocks, The Media Shoppe inched up one sen to 9.5 sen, Naim Indah increased 1.5 sen to 53 sen, Green Ocean Corp rose 2.5 sen to 30 sen and Kumpulan Hartanah Selangor climbed half sen to 63 sen.

China Stationery Ltd lost 10 sen to RM1.08.

Of the heavyweights, CIMB rose 15 sen to RM7.48, Sime Darby increased two sen to RM10 and Tenaga added six sen to RM6.31. Maybank and Maxis were unchanged at RM8.77 and RM5.94 respectively. - Bernama



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Affin's plan for Islamic banking ops in China by 2H2012

KUALA LUMPUR (March 5): AFFIN HOLDINGS BHD [] expects its plan to set up Islamic banking operations in China to materialise in the second half (2H) of this year.

Deputy Chairman Tan Sri Lodin Wok Kamaruddin said Affin Holdings would collaborate with its shareholder, Hong Kong-based Bank of East Asia Ltd (BEA), to offer Islamic banking products in China.

BEA, which holds some 23 percent of Affin Holdings, is the biggest foreign bank in China.

“We hope to make a breakthrough this year. It takes a bit of time but Insyaallah (God willing), by middle or end of this year, it will materialise,” he told Bernama in an interview.

He said Affin is currently looking at various opportunities to set up some form of Islamic banking operations in China and it would be under the brand name of “Affin Bank”.

“It could be in the form of branches... We have not finalised on the structure of the operations,” he said.

According to him, Affin wanted to further strengthen and tighten its relationship with BEA by not only working with the latter in Malaysia but also in China.

He said there was room for expansion for Affin Islamic, which has been growing steadily. Affin Islamic is a wholly-owned unit of Affin Bank, which in turn is 100 per cent-owned by Affin Holdings.

Lodin also said that Affin Bank is revisiting its plan to acquire an 80 per cent stake in Indonesia's P.T. Bank Ina Perdana.

“We did announce that we wanted to acquire Bank Ina about one and a half years ago. However, we have to put this plan on hold because of a report, which stated that the central bank of Indonesia is considering to cap foreign ownership in its banks to less than 50 per cent. Now that this will not happen, we are revisiting the Bank Ina proposal again,” he said.

According to him, Bank Ina, a conventional bank, has 20 branches in Indonesia and Affin's plan is to convert it into an Islamic bank.

“Indonesia is a good market as Muslims make up 90 per cent of its population of between 200 million and 300 million,” he said.

On the local front, Lodin said Affin Bank is looking at a few options to expand its Islamic finance business, either organically or inorganically.

“We are looking at various options to grow our Islamic banking business which includes possible merger. If there is an opportunity for us to grow by merger and acquisition, why not?” he added. - Bernama



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TMS declines participation in KTM project, cites funding

KUALA LUMPUR (March 5): THE MEDIA SHOPPE BHD [] has declined to take part in the project involving the automatic fare collection system for Keretapi Tanah Melayu Bhd’s commuter stations.

The company said on Monday it was not feasible for it to undertake the project which was awarded by Hopetech Sdn Bhd mainly “due to funding is not available within the required time frame of delivery”.

Hence, TMS said it had decided not to accept the letter of award from Hopetech.



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CIMB Group expands stock broking biz into Sri Lanka

KUALA LUMPUR (March 5): CIMB Group Holdings Bhd is expanding its stock broking business into Sri Lanka via a strategic tie-up with John Keells Stock Brokers (Pvt) Ltd (JKSB).

CIMB said on Monday its unit CIMB Securities (Singapore) Pte Ltd had entered into the collaboration agreement with JKSB to facilitate CIMB Group’s stock broking there.

“JKSB will also supply CIMB Group with research which will be disseminated to CIMB’s clientele globally under a CIMB/JKSB co-branded banner,” it said.

JKSB is a founder member of the Colombo Stock Exchange and a subsidiary of John Keells Holdings PLC. It will be CIMB Group’s trade execution partner in Sri Lanka and support CIMB in its sales initiatives.



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Denko scraps private placement plan due to market conditions

KUALA LUMPUR (March 5): DENKO INDUSTRIAL CORPORATION [] Bhd has scrapped its plans to undertake a private placement of up to 10.44 million new shares of 10% of its paid-up share capital.

It said on Monday the board had decided not to go ahead with the corporate exercise due to the current market conditions.

However, it would go ahead with the proposed par value reduction and share premium reduction.



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S P Setia unit to raise RM505m debt notes

KUALA LUMPUR (March 5): S P Setia Bhd has proposed to raise RM505 million to part finance the purchase of a piece of land in Rinching, Semenyih, Selangor.

The property company said on Monday its unit Setia EcoHill Sdn Bhd had proposed to issue commercial papers and/or medium term notes of up to RM505.0 million in nominal value.

“The notes will be issued in two tranches of MTN up to RM305 million and CP and/or MTN up to RM200 million. Tranche 1 (RM305 million) will be fully subscribed by Alliance Bank Malaysia Bhd. The primary subscriber for Tranche 2 (RM200 million) has yet to be determined,”it said.



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Market Commentary

The FBM KLCI index gained 5.44 points or 0.34% on Monday. The Finance Index increased 0.53% to 14204.47 points, the Properties Index dropped 0.05% to 1065.4 points and the Plantation Index down 0.19% to 8661.77 points. The market traded within a range of 8.59 points between an intra-day high of 1594.72 and a low of 1586.13 during the session.

Actively traded stocks include TMS , NICORP, GOCEAN, KHSB, CSL, DRBHCOM-CF, DRBHCOM, COASTAL-CA, DRBHCOM-CG and YTL. Trading volume decreased to 1448.66 mil shares worth RM1760.84 mil as compared to Friday’s 1630.35 mil shares worth RM1934.59 mil.

Leading Movers were CIMB (+15 sen to RM7.48), GENTING (+16 sen to RM10.76), TENAGA (+6 sen to RM6.31), PBBANK (+6 sen to RM13.76) and MMCCORP (+9 sen to RM2.84). Lagging Movers were YTL (-4 sen to RM1.74), KLK (-18 sen to RM23.40), GENM (-3 sen to RM3.87), AXIATA (-1 sen to RM5.16) and PETCHEM (-1 sen to RM6.89). Market breadth was negative with 391 gainers as compared to 414 losers. -- JF Apex Securities Bhd



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Flash: Petronas posts 3Q net profit of RM13.5 bn, dividends RM28 bn

KUALA LUMPUR (March 5): Petroliam Nasional Bhd posted net profit of RM13.542 billion for the third quarter ended Dec 31, 2011, down 36% from RM21.205 a year ago where there was a one-time gain from the sale of share in two units.

It said on Monday, its financial performance benefited from higher crude prices and improved sales volumes of most products.

It had proposed a tax exempt final dividend amounting to RM28.0 billion for the financial period ended Dec 31, 2011.

Commenting on the prices, it said the higher crude prices were driven by supply concerns arising from the geo-political crises in the Middle East and North Africa region. As a result, benchmark crude prices spiraled upwards with Dated Brent increasing by 26.4% and Tapis OSP by 33.2% on a year-on-year comparison.

Group revenue improved by RM18.0 billion or 29.9% to RM77.997 billion from RM60.041 billion due to higher realised prices of crude oil and condensates and other energy commodities.

“Profit and EBITDA (earnings before interest, tax, depreciation and amortization) decreased by RM8.2 billion and RM3.3 billion respectively as compared to the same quarter last year which were primarily contributed by the gain of RM9.3 billion from the initial public offerings of Petronas Chemicals Group Bhd and Malaysia Marine and Heavy Engineering Holdings Bhd recorded last year,” it said.

Petronas said that excluding the IPO gain, profit and EBITDA increased by RM1.1 billion and RM6.0 billion respectively due to improved margins.



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MARC lowers outlook on Alam Maritim debt notes to negative

KUALA LUMPUR (March 5): Malaysian Rating Corporation (MARC) has revised the outlook on ALAM MARITIM RESOURCES BHD []’s Islamic notes from stable to negative following the company’s weaker credit profile.

The ratings agency said on Monday it had affirmed its ratings at AA-IS and MARC-1ID/AA-ID on Alam Maritim’s RM500 million Sukuk Ijarah medium term notes and RM100 million Murabahah commercial papers/Murabahah medium term notes programmes respectively. The rating action affects RM475 million of outstanding notes issued under the rated programmes.

“The revised outlook reflects the pressure on Alam Maritim's credit profile arising from significantly weaker earnings and cash flow generation in 2010 and 2011,” it said.

MARC pointed out Alam Maritim’s earnings had been pressured by lower vessel utilisation and charter rates, reflecting strong competition and a difficult operating environment.

While MARC acknowledges the improvement in Alam Maritim’s operating environment since the second quarter of 2011 it believed the group’s financial measures would remain weak for the current ratings in the next 12 to 18 months.

The ratings agency added the negative outlook also reflects the limited headroom within Alam Maritim’s consolidated financial metrics and current ratings to absorb any further adverse operating developments.

“Without a sustained recovery in market conditions, Alam Maritim’s will likely face substantial challenges in maintaining adequate credit metrics for its current ratings. The affirmed ratings continue to acknowledge Alam Maritim's established and leading position in the domestic offshore support vessel (OSV) market, and its liquidity position which remains adequate vis-à-vis its debt maturity profile,” it said.

Alam Maritim is the third largest domestic OSV operator by tonnage; it owns 41 Malaysian-flagged vessels comprising mostly anchor handling tug supply (AHTS), utility and supply vessels.

The company expects to take delivery of another two AHTS vessels with the latest dynamic positioning system this year, which should benefit its domestic competitiveness.

While the OSV charter business remains its core earnings generator, its other key businesses include underwater services and offshore related installation and CONSTRUCTION [] activities.

“The rating outlook could revert to stable if Alam Maritim’s operating performance improves over the coming quarters and the group continues to demonstrate sufficient cash flow generating capability and liquidity to meet its notes obligations, failing which the ratings would come under downward rating pressure,” it said.



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China Stationery continues to lose ground

KUALA LUMPUR (March 5): Shares of China Stationery Lt (CSL) extended their decline on Monday as investors continued to take profit after the strong performance on its listing on Feb 24.

At 3.33pm, it was down 11 sen to RM1.07. There were 21.99 million shares done.

It was listed on Feb 24 at an offer price of 95 sen and it rose to a high of RM1.44 on Feb 29.

The KLCI was up 6.02 points to 1,589.80. Turnover was 1.10 billion shares valued at RM1.18 billion. There were 380 gainers, 371 losers and 316 stocks unchanged.



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Ivory Properties to launch projects with RM1.4 bn GDV in Penang

KUALA LUMPUR (March 5): An upbeat Ivory PROPERTIES [] Group Bhd plans to roll out residential and commercial projects on Penang island with a total gross development value of RM1.4 billion this year.

Its chairman and group chief executive officer Datuk Low Eng Hock said they were targeting some RM800 million of sales in 2012, including on-going projects.

The projects to be launched are The Latitude in Mount Erskine, Penang Times Square phases three and four, City Mall and City Residence in Tanjung Tokong.

“Last year, we booked RM121.8 million of sales for completed and on-going project as well as unbilled sales of RM227 million. We are expecting a rise in the amount this year since we have more projects to offer this time, not forgetting the much anticipated Penang World City development in Bayan Mutiara,” he said in a press statement after the EGM on Monday.

At the EGM, Ivory Properties shareholders approved the company's plan to purchase and develop a 41.02ha site in Bayan Mutiara from Penang Development Corporation and Chief Minister of Penang (Incorporation).

They also approved the joint venture with DIJAYA CORPORATION BHD [] to develop the land. Undertaking the project would be the JV company -- Tropicana Ivory Sdn Bhd which is 55% owned by Dijaya and 45% by Ivory Properties.

The plan is to undertake a mixed-use residential and commercial property project named Penang World City with estimated GDV of RM10 billion.



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KLCI bucks key regional markets

KUALA LUMPUR (March 5): The Malaysia stock market bucked the regional markets on Monday, underpinned by gains in selected banking stocks and heavyweights, while the broader market displayed an upbeat outlook as the FBM KLCI neared the all-time high of 1,594.

At 12.30pm, the KLCI was up 0.4% or 6.71 points to 1,590.49, but off a fresh intraday high of 1594.72. Turnover was 832 million shares worth RM818 million. Gainers beat losers 381 to 289 decliners while 316 counters were unchanged.

However, Asian stock indices declined at noon amid news that China had revised downwards its economic growth forecast to 7.5% in 2012. This compares to policymakers’ targeted growth of 8% between 2005 and 2011. China's economy rose 9.2% in 2011 from a year earlier following a 10.3% expansion in 2010.

Hong Kong’s Hang Seng Index fell 1.13% to 21,318.9, Taiwan’s Taiex lost 1.08% to 8026.96 while South Korea’s Kospi was down 0.9% to 2016.31 and Singapore’s Straits Times Index 0.16% at 2,988.72.

On the KLCI, analysts said it was trading at more expensive valuations compared to regional peers.

In a note on Monday, TA Securities Holdings Bhd head of research Kaladher Govindan said Indonesia and Thailand, offered better calendar year 2013 earnings growth prospects of 17.8 % and 14.9% respectively and are trading at a relatively cheap price-to-earnings ratios (PER) of 11.5 times and 10.7 times respectively.

This compares to Malaysia's FBM KLCI’s projected 12.2% growth at a PER of 13.2 times (based on Bloomberg consensus figures).

“While Malaysia being a low beta market had only advanced by 2.5% year-to-date, continued PER expansion in other regional markets on positive market undertone has the potential to rerate Malaysia as well.

“The impending announcement of various infrastructure and oil gas projects under the Economic Transformation Programme banner in the first half of this year could be strong drivers for the market apart from the listing of Felda Global Ventures that could draw fresh funds from abroad,” said Kaladher who does not discount the possibility of the KLCI testing the 1650 point level during the first half of the year.

Among the finance stocks, CIMB rose 16 sen to RM7.49 and Public Bank 10 sen to RM13.80. Heavyweight Sime Darby, which was upgraded, rose 10 sen to RM10.08.

As for PLANTATION []s, NSOP added 14 sen to RM6.10, TDM 10 sen to RM4.96, Batu Kawan four sen to RM18.98, TH Plantations three sen to RM2.83 but KUALA LUMPUR KEPONG BHD [] fell 12 sen to RM23.46.

Top gainer ORIENTAL HOLDINGS BHD [] added 21 sen to RM6.70 followed by Tasek Corp which rose 19 sen to RM9.

Notable decliners include PETRONAS DAGANGAN BHD [] which fell 22 sen to RM18.12 while Kulim and MBM Resources lost eight sen each to RM4.37 and RM4.57.

Most active was THE MEDIA SHOPPE BHD [] which added 1.5 sen to 10 sen with some 45 million shares done.



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Hubline fixes 16.50m placement shares at 20 sen each

KUALA LUMPUR (March 6): HUBLINE BHD [] has fixed the price for the 16.50 million placement shares with 24.75 million additional warrants at 20 sen per share.

It said on Monday the issue price was 122% above the five-days volume weighted average market price of Hubline shares up to and including March 2 of nine sen per Hubline share.



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KLCI nears all-time high, Sime, CIMB lead

KUALA LUMPUR (March 5): The KLCI got off on a firm start on Monday, with the 30-stock index nearing the all-time high of 1,594 reached in July 2011.

The advance in the KLCI was driven by heavyweights Sime Darby and CIMB, as they extended their gains from last week on buying by fund managers following more upside for both companies.

At 10.49am, the KLCI was up 8.87 points to 1,592.65. Turnover was 496.51 million shares valued at RM444.84 million. There were 363 gainers, 209 losers and 268 stocks unchanged.

Maybank Investment Bank Research said it was lifting 2012 year-end KLCI target to 1,565 on raised market earnings post 4Q11 corporate results reporting and after imputing a higher crude palm oil average selling prices expectation.

“While corporate earnings outlook seems to have stabilised and a crisis appears to have been averted in the Eurozone, rising crude oil prices is a new concern, while on the domestic front, the 13th general election will lend to cautiousness,” it said.

Aeon was the top gainer, up 38 sen to RM9.38 while Tasek added 30 sen to RM9.11 and Oriental Holdings 25 sen to RM6.47. Other gainers were Can-One, up 20 sen to RM1.99, Panasonic 16 sen to RM22.16 and GAB 14 sen to RM13.64.

Sime Darby rose 16 sen to RM10.14 and CIMB 15 sen to RM7.48.

JP Morgan Research said Sime Darby remained its top large-cap Asean PLANTATION []s pick. It said Sime's 2QFY12 core net profit of RM1.032 billion (up 18% on-year) came in 12% ahead of consensus expectations of RM922 million.

Last Thursday, CIMB had signed an MoU for the proposed acquisition of cash equities, equity capital markets and corporate finance businesses of The Royal Bank of Scotland in Asia Pacific.



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AmResearch reaffirms Buy on DRB-Hicom, unch FV RM4

KUALA LUMPUR (March 5): AmResearch has reaffirmed its Buy rating on DRB-Hicom with its fair value unchanged at RM4 a share, pegging a 10% discount to its sum-of-parts value of RM4.40 a share.

The research house said on Monday it was reported in the press today that DRB-Hicom is evaluating plans by Mitsubishi, Volkswagen and General Motors (GM) to revive Proton.

It said that GM has proposed to gain control of half of Proton’s production lines at the latter’s plant in Tanjung Malim. This is not something new as it was already speculated in the market earlier that GM plans to buy a 50% stake in the plant.

“This proposal makes sense given the much-publicised under-utilised Tanjung Malim plant – running at barely 50% utilisation. A valuation of RM800 million for the plant stake has been bandied about but the key point here is that Proton would be able to achieve economies of scale,” it said.

AmResearch said it continues to like DRB-Hicom, given it is one of the cheapest conglomerates – trading at CY12 of 13 times versus its peers of 18 times.

“The group is on an exciting growth path, as it is the best proxy to VW’s ambition to be a key ASEAN auto player. DRB would also benefit in the transformation of Pos Malaysia – recently showing strong a set of results – and the next leg up would be to reap the synergies with its sister company, Bank Muamalat,” it said.



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RHB Research downgrades Berjaya Sports Toto to market perform

KUALA LUMPUR (March 5): RHB Research Institute has revised its forecast for Berjaya Sports Toto’s for FY04/12-14 upwards by 0.8%-5.4% to take into account the higher number of draws after including the special draws and the lower sales per draw assumptions.

It said on Monday that despite its revised earnings forecasts, its DCF-based fair value remains relatively unchanged at RM4.85.

“However, given our more upbeat outlook on the economy, we believe BToto’s defensive nature may no longer appeal to investors in the medium term, who are now looking for higher beta stocks,” it said.

RHB Research it also believes earnings prospects from the 4D jackpot have already largely been reflected in its share price and consensus estimates.

“As such, we are downgrading our recommendation on the stock to a Market Perform (from outperform),” it said.



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CIMB Research maintains Buy on Mudajaya, RM3.45 target price

KUALA LUMPUR (March 5): CIMB Equities Research is maintaining its Buy and RM3.45 target price.

“Positives from the group’s maiden briefing last Friday reinforced our trading-oriented Buy recommendation. Though there were no major surprises, we were encouraged that management was more upfront on its target jobs and strategies,” it said on Monday.

CIMB Research it appears that there is a high chance of more power plant-related jobs in the pipeline, which should add to the expected positive news flow from the roll-out of other jobs under the 10MP and ETP.

“There should also be excitement on the potential winners of the MRT elevated packages which will be awarded over the next six months. We make no changes to our EPS forecasts as we continue to assume RM1.5bn worth of new jobs in 2012,” it said.

CIMB Research said its RM3.45 target price remains pegged to 40% discount to RNAV. Project wins continue to be the stock’s key potential catalyst,” it said.



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CIMB Research has technical sell on Winsun at 19 sen

KUALA LUMPUR (March 5): CIMB Research has technical sell on Winsun Technologies at 19 sen at 19 sen at which it is trading at a price-to-book value of 19 sen.

It said on Monday that Winsun Technologies is trading in a rising wedge pattern, suggesting that the run-up is about to exhaust. Once the candles fall below the support trend line (now at 17.5 sen), expect correction to be sharp. Next support is at 15.5 sen and 14 sen.

"Hence, our strategy here is to unload on strength, especially near the 19 sen to 20 sen resistances. Always put a buy stop at 20.5 sen, just in case. The bearish divergence on the RSI indicator shows that buying momentum is losing pace. MACD signal line is also about to stage a negative crossover," it said.



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CIMB Research has technical sell on Wijaya Baru Global at 78 sen

KUALA LUMPUR (March 5): CIMB Equities Research has a technical sell on Wijaya Baru Global at 78 sen at which it is trading at a price-to-book value of 0.8 times.

CIMB Research said on Monday that Wijaya Baru has been gyrating in a rising wedge pattern for a long time and the recent fall could be seen as a prelude to more downside ahead," it said.

"If we are right, selling pressure should accerate in days to comme, if not weeks, unless prices swing back above the support-turned-resistance trend line," it said.

The research house said the MACD signal line has slipped into the negative territory. RSI is also below the 50pts mark. Hence, the odds are slightly favouring the bears.

"Use any rebound towards 79 sen to 82 sen to unload on strength. Unless prices swing past the RM0.845 level, we would rather stick with the bear’s camp.The support is at 72.5 sen and 68 sen," it said.



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CIMB Research has technical buy on Magna Prima at 86.5 sen

KUALA LUMPUR (March 5): CIMB Equities Research has a technical buy on MAGNA PRIMA BHD [] at 86.5 sen at which it is trading at a price-to-book value of 1.9 times.

The share price broke out of its descending wedge pattern on Friday. The upswing also took out its 30-day SMA along the way.

CIMB Research said on Monday that looking at the chart, it believes the stock is poised for stronger rebound, possibly towards 91 sen and 95 sen next.

It said the technical landscape is improving, reinforcing our bullish stance. MACD signal line is poised for a positive crossover while RSI has hooked upward.

“Aggressive traders may take some position here while others can accumulate during technical pullback. Only a fall below 84.5 sen, its previous swing low, would prompt us to review our call,” it said.



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Stocks to watch: eBworx, UEM Land, CBIP, KLK

KUALA LUMPUR (March 3): With the FBM KLCI currently at overbought levels, investors ponder whether the FBM KLCI can reach the all-time high of 1,594.74 in July 2011.

On Friday, CIMB led the KLCI to a higher close, as the firmer blue chips galvanised market sentiment. The KLCI rose 10.33 points or 0.66% to 1,583.78.

A further upward trend could boost sentiment among smaller cap stocks, but this would also hinge on external factors from the eurozone and high oil prices which could stifle global growth.

On Wall Street, the S&P and Nasdaq notched their eighth week of gains out of the last nine, but momentum ran out on Friday as stocks ended the day lower in a thinly traded session.

Energy shares were the big losers in the broad decline, falling alongside crude oil prices, though other cyclical groups, including industrials and financials, also lost altitude.

Reuters said the Dow Jones industrial average dipped 2.73 points, or 0.02 percent, to 12,977.57 at the close. The Standard & Poor's 500 Index slipped 4.46 points, or 0.32 percent, to 1,369.63. The Nasdaq Composite Index shed 12.78 points, or 0.43 percent, to close at 2,976.19.

For the week, the Dow inched down 0.05 percent, while the S&P 500 rose 0.3 percent and the Nasdaq added 0.4 percent. On Tuesday, the Dow closed above 13,000 for the first time since May 2008, though it has subsequently struggled to maintain that level.

Affin Investment Bank head of retail research Dr Nazri Khan said on the technical front, the short term momentum might be overbought, but it was normal to expect the KLCI to stay at overbought level for an extended period of time.

“With the KLCI at seven months high, we see the bulls having the upper hand now with all oscillators pointing up accompanied by good trading volume (KLCI has rallied a respectable 62 points and 4% year-to-date with 1.6 billion shares average daily volume suggesting strong buyers underneath).

“The next FBMKLCI target should ultimately come in at July 2011 all-time-high of 1597 level. Short term supports meanwhile are seen at last week high and low near 1565 and 1550 level respectively,” he said in a note.

Meanwhile stocks to watch on Monday include EBWORX BHD [], UEM Land Bhd, CB INDUSTRIAL PRODUCT HOLDING [] Bhd (CBIP), KUALA LUMPUR KEPONG BHD [], ENVAIR HOLDING BHD [] and CyPARK RESOURCES BHD [].

Hitachi Ltd had on Friday launched a conditional voluntary general offer for eBworx Bhd with an indicative purchase price of 90 sen a share. Its pre-suspension price was 78.5 sen.

eBworx said Hitachi had proposed to acquire the shares by making a conditional voluntary general offer to all holders of the shares with a minimum level of acceptances of no less than 85% of the nominal value of the shares excluding the treasury shares held by the company.

UEM Land has targeted a 40% increase in net profit under its key performance indicators for 2012. It was reported the property developer was also targeting a 50% increase in revenue.

UEM Land managing director and CEO Datuk Wan Abdullah Wan Ibrahim was quoted as saying the optimism was underpinned by the various launches this year with a combined gross development value of RM4.5 billion.

He was also quoted saying that for 2012, UEM Land was targeting to achieve RM3 billion in property sales with new residential and commercial property launches.

Meanwhile, The Edge weekly said palm oil mills builder and equipment manufacturer CB Industrial Product Holding is quietly transforming itself into a medium-size palm oil player with the expansion of its Indonesian PLANTATION [] venture.

CBIP would also attract interest as its one-for-one bonus issue goes ex on Monday.

KL Kepong plans to build three refineries in Indonesia to tap higher margins after Jakarta lowered its processed edible oil export taxes, Reuters reported.

With 56% of the its total 248,498 ha land bank in Indonesia, KLK’s plantations director Roy Lim was quoted saying there was little choice but to build the refineries there.

Envair plans to undertake a private placement of up to 35.56 million new shares or 30% of its paid-up to raise RM9.78 million or 27.5 sen per share. It last traded price was 29.5 sen.

The shares would be placed out to its major shareholder Deepak Jaikishan, the directors Mohd Anuar Mohd Hanadzlah and Mohd Shukri Abdullah and independent third parties.

Cypark Resources Bhd has proposed a private placement of up to 15.52 million shares or 10% of the paid-up share capital, to raise up to RM27.48 million.

The indicative issue price was RM1.77 per placement share, which would be a discount of about 10% to the five-day volume weighted average market price of the shares up to and including the last practical date of RM1.9585.

Poultry-based DBE Gurney Bhd has proposed to place out 67.33 million shares or 10% of the current paid-up share capital to raise funds for working capital.

It said the proposed private placement will enable the group to raise fund for working capital requirements, improve the group’s cash flow position and also to provide continued support to the group’s existing business and future business expansion.

DBE Gurney said assuming the placement shares were issued at an indicative issue price of 10 sen per placement share based on the par value of the shares, the proposed private placement is expected to raise gross proceeds of up to RM6.73 million.



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