Written by Joseph Chin
Saturday, 20 February 2010 16:58
KUALA LUMPUR: Regional markets could start off the new week, starting on Monday, Feb 22 on a firmer note after Wall Street closed higher on Friday as investors viewed the Federal Reserve's discount rate increase as evidence the financial system is healing.
The Dow Jones industrial average gained 9.45 points, or 0.09%, to 10,402.35. The Standard & Poor's 500 Index rose 2.42 points, or 0.22%, to 1,109.17. The Nasdaq Composite Index edged up 2.16 points, or 0.10%, to 2,243.87. However, investors are worried the eventual withdrawal of easy money will hurt Wall Street.
At Bursa Malaysia, stocks to watch include GENTING BHD [], MALAYSIAN AIRLINE SYSTEM BHD [] (MAS), Supermax Corp Bhd, EON CAPITAL BHD [] and Proton Holdings Bhd.
Genting, whose share price fell 18 sen to RM6.36 on Friday, could have seen RM667 million erased from its market capitalisation. It could continue to come under selling pressure after Genting Singapore plc posted net losses of S$277.56 million (RM 669 million) in the financial year ended Dec 31, 2009.
In FY08, net losses were S$124.80 million. The FY09 weaker performance was due to losses in derivative financial instruments, higher pre-operating expenses and lower contribution from its UK casino operations.
Meanwhile, MAS will release its results on Monday. The entitlement to the rights shares will cease on Tuesday. MAS shares fell nine sen to RM1.80 while MAS-OR fell 5.5 sen to 6.5 sen.
The entitlement to the rights shares had been falling since they started trading on Feb 11, slumping 30.5 sen to 13.5 sen. The rights issue is at RM1.60 per rights share.
Analysts said investors could have sold the entitlements to the rights to arbitrage. With the MAS-OR at 6.5 sen and the rights shares at RM1.60, it would be cheaper than the ordinary shares now at RM1.80.
Supermax should attract positive trading interest after it proposed a tax exempt final dividend of 8% per share of 50 sen for FY09 and special tax exempt dividend of 9%.
In its fourth quarter ended Dec 31, 2009, net profit surged nearly 30 times to RM44.11 million from only RM1.48 million a year ago, boosted from higher margins for its rubber gloves and contributions from its associates.
Revenue rose 7.4% to RM196.42 million from RM182.82 million a year ago. Earnings per share were 16.55 sen versus 0.56 sen.
Excitement is ahead for EON Cap on Monday with the EGM called by Kualapura Sdn Bhd and Lintang Emas Sdn Bhd to appoint eight more directors to the board. Kualapura and Lintang Emas are controlled by Rin Kei Mei.
Proton should attract attention after it recorded RM79.67 million in earnings in the third quarter ended Dec 31, 2009, in stark contrast to the losses of RM74.67 million a year ago as it continued to show a turnaround in its fortunes, underpinned by higher sales volumes from its new models and better margins.