Does KPS stands for...?

After the last hour hectic burst of buying yesterday, KPS went up 7 sen to RM1.65 this morning before closing the day at RM1.51 for a 7 sen loss. Could not lekat....Viagra-deficient?

Is this the start again of the on-and-off yoyoing KPS's Kepala Pening Sindrom? Hope not. Surely, there must be some fuel out there fanning the prices heavenward for both KPS and KHSB.

Market ended at 1,357.18 up 4.2 points. Gainers included DIGI which upped RM1.20, BAT which gained 75 sen and Aeon which put on 50 sen. Losers were Welli with a loss of 73 sen; and KNM which lost 50 sen.

Tracked stocks gave a mixed performance. RCE put on 4.5 sen to move up to 94 sen while BJ Toto lost 6 sen to RM4.72. POS was better 2 sen but Metronic lost 0.5 sen. Genting gave up 15 sen while Resorts was flat at RM3.18.

Metronic has announced that its bonus share exercise should be completed by July 2007. I expect the shares to go up as a tranche of new shares will be traded before the transfer and bonus issue exercise.

Heartsong

Thunderclap KPS

The market was almost fainting. Losses swarmed the board. There were some signs of movement in KPS at the start of trading. Soon, its gains were trimmed to only two sen. The same took place in the afternoon.

And then.....

Along with the heavy rain and thunderclap in KL and PJ, KPS started shooting up at the final trading hour with buyers galore snapping up all the stocks on offer until the final bell. KPS ended 22 sen higher at RM1.58; a record high. 13.34 million shares were traded. What gives?

Hope there will be a strong follow-through tomorrow. If the rumour that KPS will be taken private is true, then it will shoot to the next galaxy in stock prices in the near term.

We await with baited breath....

Heartsong

Dull, Dull, Dull

Three little words as above will likely sum up the mood of the market today.

After a slightly better opening, it started slumping almost within the first half hour. CI went down 2 points and all counters started looking for the Antartic. By the end of the fist hour only tracked stocks, BJ Toto and RCE put on some gains. BJ Toto added 2 sen to RM4.82 and RCE added a sen to 89 sen. The rest were either overnight or experiencing marginal losses.

After the announcement of Goldman Sachs additional investment in SAAG, the stock added 35 sen. Deleum added 25 sen and Proton; upped 20 sen after news of a positive meeting with VW. Another follow-up meeting in Bangkok to look further into strategic alliance has been proposed.

The strange biggest loser continues to be AHB which went down further by another 42 sen. It lost over a ringgit yesterday. Wonder how it will impact RCE which has about 8% of the stock. IOI Corp dropped 10 sen and so did Bursa.

Market ended down 7.5 points to 1,353.03. As predicted most counters were at overnight levels or suffered marginal losses.

I expect the market to go a yoyo for the next few days. There will be intra-day highs and lows and a couple of random walk counters.

Generally, more money is leaving Malaysian shores as mutual funds destined for overseas market like those managed by ING, CIMB and PBB mopped up liquid fixed deposits that are moving out to take advantage of recently launched protected funds. Local mutuals will suffer and so will second-level blue chips. So our local Bursa will possibly be driven only by local gilt-edged blues. That will possibly see Genting and Resorts back in the lime-light after sometime.

Pray hard this privatisation trend will end soon as it is really making the market shallower and depriving it such darlings like MAXIS, Magnum 4D and the like. Otherwise Bursa can surely go down!

Heartsong

The ING Baraka Capital Protected

A RM300 million fund, it is open to the public from 9th May to 22nd June 2007. Its original size is RM200 million but another 50 % i.e. RM100 million was approved by the Securities Commission recently for additional subscription.

Know who ING Investment Management Asia Pacific is. This is their reputation. It was ranked the number one retail investment manager for Asia-Pacific ex-Japan in 2005. It is also the number 6th ranking institutional investor ex-Japan. It won the Asia Asset Management 2006 Award for most innovative product. Currently two of the funds it is managing in Malaysia is doing well. AsiaPac Capital Guaranteed is worth 11.7% more in value and the ING GIO Capital Protected is worth 6.4% more.

With that as the background, what about the ING Baraka Capital Protected? Is the risk manageable? Will it go the way of the earlier two funds?

Let us look at asset allocation. 85 % will be invested in Islamic Negotiable Instruments; 10% in SGAM Baraka Option and up to 5% in Islamic fixed income instruments. If you hold your investment for the full tenure, you will be assured of capital return. So what is at risk? Opportunity cost; the least of which is the current interest rate regime which is at 3.7%. Anything above that will be considered fair to good. You may also get nothing. That is the worse scenario. If there are some gains, these should be proportionately benchmarked against the prevailing interest rate; 36 months down the road.

Given its good track record and the acumen of Societe Generale in global investments, I think the ING Baraka Capital Protected is a low risk investment with good upside potential. If it is true that they actively manage their portfolio of 30 selected stocks every quarterly,then I believe that the down side will be fairly minimal.

If you have 5 Grand to spare, Baraka could be your vehicle to better asset management and wealth creation. All the best.

Heartsong

Expect a Dull Day

Doesn't look good. Index opened at 1,357.27 for a 0.39 points fall. Stemlife continued its upward movement adding 30 sen. Others that made good gains included BAT,NSOP and Latexx. Losers include SAAG, Guoco and Maybank.

Market leaders like Genting and Resorts are still in limbo. Resorts is at its overnight level while Genting upped 5 sen. KPS added a sen. POS was at its overnight level and BJ Toto gave up 2 sen. Similarly RCE gave up 0.05 sen and Metronic reduced 1 sen.

I expect a no-go market. Classic situation where there are really no great market news to bring both the investors and the short term punters vigorously into tandem play.

True to my gut feelings, the market is ''bolat''. Hokkien for ''no strength'' Ended at 1,360.58 for a 2.9 points gained. The counters I am tracking fared badly. RCE dropped 3 sen, KPS lost a sen, Resorts was worse off by another 2 sen to scrape a new low of RM3.18 and even BJ Sports Toto lost 4 sen to RM4.80. Similarly Metronic lost 1.5 sen to 38 sen and POS gave up 2 sen to RM4.28. Only a solitary Genting put on 10 sen to RM8.00.

Major gainers included BAT which put on RM1.50; Tanjong which added 30 sen and Kian Joo which upped 25 sen. Sad and sorry losers were SAAG with a ringgit loss, Guoco; shedding 36 sen and LCL down 35 sen.

A really louya market, if there ever was one. I think fund managers are taking a breather especially not knowing how Wall Street will perform in the short term. So time to play golf, write a few emails to old friends and perhaps time to catch up on your reading.....


Heartsong

First Quarter Impressions

OSK Investment Research in THE STAR on 9 June 2007 made the following analysis and impressions based on the financial results of the first quarter of 2007. I have abridged some of them here for our attention. I have also added my comments and predictions. These are in italics.

They are generally bullish on oil and gas, plantation and construction. To the perceptive eye, these are obvious.

Let us look at the sectors that they focused.

Banking:

Performance was mixed. However they are still positive of Public Bank,Hong Leong Bank and possibly Maybank.

Building Materials:

Most companies met their forecasted performance. With the roll-out of the 9th Malaysia Plan projects, they can only get better.

Conglomerates:

They were happy with Faber. MMC has yet to see the contribution of Malakoff at this stage. My comment is to watch out for MRCB especially with this market talk of EPF buying into Equine through MRCB. Equine has gone up 300% since April.

Construction:

Performed below par but no panic situation as yet. The early roll-out of 9thMP projects should provide the impetus for market action.

Casino and Number Forcast

Resorts did well and so did Genting, BJ Toto, Tanjong and Magnum. Star Cruise should contribute more in H2 when tourists arrive from the northern hemisphere as the cold months begin to set in. Genting is benefiting from good oil palm prices from Asiatic. Also Visit Malaysia Year will help Genting and Resorts World to achieve better results in the ensuing quarters of 2007. Good buy if you intend to go into this defensive counters particularly super dividend provider, BJ Toto, and robust Genting and Resorts World.

Motor :

Bad. do not touch it with even a long pole.

Plantation:

Anybody's guess. With the trending up of oil palm prices to RM2,500 per tonne, plantation stocks are good buys. Buy those with small caps. Remember oil palm prices may just peaked off at year's end.

Power:

Both YTL and TNB brought in better than forecasted results though there are non-operating revenue contribution on both companies' accounts. TNB also benefited from the tariff hike.

Oil and Gas:

Star performers. Small caps did better than the large caps. Dialog and KNM brought in lower than expected results though the next quarters could see lumpy earnings coming into play.

Property:

Results of most companies within expectations. Recommend selective stocks involved in higher end market and in IDR region. Plenitude is a good stock to watch as it operates in the SJER and will benefit when the monorail comes on steam.

Telcos:

Digi outperformed but MAXIS was within expectations with revenue coming from its Indian operations. TM is worrisome as it starts to lose more revenue from fixed lines.

Timber:

Results are acceptable. The summertime Japanese construction market will create demand and push prices up.

Water:

Slow start. Taliworks performed below par. If and when news of the development of the WTP becomes clearer, expect this sector to move forward. Watch out for the Puncak Niaga, KPS and KHSB counters.


Heartsong

Good Start for the Week

The CI went up by 12.7 points to touch 1,365.11 at the start of trading and the clear market leaders seems to be SAAG, Guoco, Tanjong and Commerce. They put on gains between 30-60 sen. The losers were EON Cap down RM1.28, AHB by 41.5 sen, Transmile by 20 sen and Megan by 16 sen.

By the time the market ended, Gentings has lost 10 sen to RM7.90 and Resorts; 2 sen to RM3.20. RCE meanwhile lost 0.5 sen to 91 sen and POS; 6 sen to RM4.30. However, BJ Toto added 4 sen to RM4.84 while Metronic added a sen to 39.5 sen. Similarly KPS added a sen to RM1.37. Looks like KPS has run out of steam since the water play continues to be a no-show.

So quo vadis the market tomorrow?

From now on, the market will hinged very much on how Wall Street will perform and the decision of the US Federal Treasury Board to increase interest rate or otherwise.


Heartsong